Today, the weak dollar allows for a strong recovery in the prices of precious metals, including silver
Silver gains over 1% today, similarly to platinum. Palladium, on the other hand, gains over 2%, while gold gains 0.5%. This is the effect of a very weak US dollar, although at the same time we do not observe a decrease in yields. The dollar is losing primarily against the yen, as the head of the Bank of Japan announced possible interest rate hikes at the next meeting, which will take place in a week, after the Fed's decision. Therefore, there is a chance that the huge divergence between the Fed and BoJ policy will decrease.
Looking at the chart, we observe a clear drop in USDJPY (inverted axis), which supports a rebound in silver. Silver rebounds from the vicinity of the lowest level since August 21. Of course, it is worth noting that a similar upward movement was visible on Friday, but it was significantly reduced by the end of the session. If high levels are maintained today, the next important resistance will be the 23.6% retracement of the last downward wave and the 200-session average located slightly above at 23.4 USD.
Start investing today or test a free demo
Open account Try demo Download mobile app Download mobile app
It is worth remembering that the yen is considered a "safe" currency along with USD, which is why we often observe a positive correlation between yen changes and the prices of precious metals, such as silver. Source: xStation5
Silver is gaining 1% today, but we can see that there are even larger increases on other metals. Besides, we see that silver has been rather weak this year, although not as weak as industrial metals. Source: XTB
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
