Silver closes above all four pivots and the 50-day moving average, setting up a strong Monday start
On Friday, the market managed to close above all four key pivots, which suggests a positive trend. Spot silver also finished above its 50-day moving average at $81.72. When you look at both indicators together, it indicates a strong setup as we move into Monday’s trading session.
Next target is $86.32 — a breakout could open the door to $92 and above.
The closing price above the 50-day moving average and the halfway mark puts the market in a good position to test the swing high at $86.32. If this level is breached and generates enough momentum, we may see a rise toward the $92.20 swing high from February 4th, followed by a significant retracement zone between $92.87 and $99.66.
Iran tensions, Supreme Court ruling, new tariffs underpin Friday’s rally
Spot silver was buoyed by three main factors: the looming threat of conflict between the US and Iran, the Supreme Court’s ruling that took away President Trump’s emergency tariff powers, and his announcement of a new 15% global tariff. Perhaps what held back Friday’s rally was the decreased likelihood of the Fed reducing interest rates by 25 basis points in June.
Tariff news casts a shadow on the Fed — but the story won’t last long
On Friday, developments regarding the Supreme Court and new tariffs overshadowed some economic data that hinted at reduced chances for a Fed rate cut. I think this reaction from silver traders is temporary; eventually, they will likely turn their attention back to the possibility of lower rates.
The Supreme Court’s ruling and the response from the Trump administration were somewhat in line with expectations. I believe the main takeaway is that a burden may have been lifted for some traders. However, challenges might still arise, like questions on refunds. Additionally, these measures may face legal challenges, which could take time to resolve. I suspect the focus on tariffs will fade as a major influence on silver prices and that it’s better to watch the Fed’s policy instead.
Weak GDP, persistent inflation, and strong labor market keep the probability of a rate cut in June below 50%
Currently, weak GDP and ongoing inflation are pivotal issues driving discussions around a potential Fed interest rate cut. And let’s not forget the surprisingly strong labor market data. While there are various factors at play, it appears that the chance of a rate cut in June is still under 50%, with current estimates being about 44%, according to the CME FedWatch tool.
