FX.co ★ XAG/USD, SILVER

Silver Weekly Analysis Last week, silver (XAG/USD) had a 2.93% rally to close at $42.19, its highest level of the year. Increased anticipation that the Federal Reserve will lower interest rates by 25 basis points at its meeting on September 17 was a major factor in the move. After a series of bad labor data, including a huge downward adjustment of 911,000 jobs to previous payrolls and a sharp increase in unemployment claims, markets have now fully priced in that scenario. Even while inflation was marginally higher than anticipated, the labor market's sharp decline has overshadowed this, driving real rates lower and boosting investor interest in precious metals. The weekly swing chart shows that the primary trend is upward, with a short-term upside objective of $44.22. This pair of bottoms at $36.96 and $36.21 is the closest swing chart support. The 52-week moving average at $33.57 serves as the long-term support. The physical state of the market is contributing to silver's upward trend in addition to monetary policy. Analysts now caution that if present demand levels continue or increase, the London Bullion Market Association's (LBMA) vault inventories might run out in a matter of months. For industrial users and long-term investors looking for tangible exposure, in particular, this tightening supply picture is becoming more than simply a technical backdrop; it is becoming a fundamental problem. The eagerness of recent purchases has probably been influenced by the impending scarcity. Real factors, not merely speculative flow, have bolstered the breakout above $42, and the route to a multi-year high close to $44.22 is still available. Now, everyone is waiting for the FOMC decision on September 17. The backdrop for silver is still favorable, barring a hawkish surprise, and traders should brace themselves for additional gains as global and micro factors align.