Silver Stuck at Resistance
26 May 2022
The precious metal was down nearly 1% during the US session, despite US yields trading slightly lower and the greenback not willing to recover from this week's sell-off.
US data not moving markets today
The annualized rate of real GDP growth in Q1 2022 came in at -1.5%, lower than the original estimate of -1.4% and the market's anticipation of -1.3%, according to figures released on Thursday by the US Bureau of Economic Analysis.
Additionally, there were 210,000 first unemployment claims in the week ending May 21. That was a tad lower than the projected reduction from 218,000 the week before to 215,000. At the same time, data showed that continuing jobless claims worsened notably, printing 1.346 million, up from 1.315 million previously.
Moreover, according to Moody's newest global growth forecast, G20 economies would expand at a rate of 3.1% in 2022, down from 5.9% in 2021, according to Reuters.
Silver tests resistance
It appears that silver is having major issues breaking above the major selling zone at previous lows near 22 USD. As long as the metal trades below that level, the medium-term outlook remains bearish.
In that case, silver could decline back toward 21.50 USD, with a possible retest of the current cycle lows near 20.50 USD.
Alternatively, if bulls manage to push the price above 22 USD, we might see another leg higher in a short-squeeze rally, targeting 22.20 USD and 22.50 USD. The major target for bulls should be at the 200-day moving average at 23.50 USD.