Silver Holds Ground as Investors Await Key US Inflation Data, Market Finds Support on Fundamentals

Silver traded at $38.12 per ounce in early Monday trading, easing slightly after strong gains that brought the metal near recent highs. These figures come directly from the latest market session and the visible charts.

The consolidation follows an active 24 hours marked by profit-taking and investor caution, as market participants prepare for new US inflation data set for release today.

The previous day saw silver pull back from its intraday high above $38.21 to close lower, with selling pressure visible during both the US afternoon and Asian overnight sessions.

The main driver was profit-taking after last week’s rally, which lifted prices to multi-year highs. The dollar’s modest overnight strength and thin liquidity overnight also contributed to the mild retreat.

Trading volumes increased on futures and over-the-counter markets, according to exchange data. ETF flows remained positive but moderated, indicating continued investment demand though with slightly less urgency than last week.

Several large ETFs that track silver reported net inflows but at a slower rate compared to the month before. Technically, the daily price chart displays several commonly used indicators.

The 50-day and 200-day moving averages continue to slope upward, showing the overall uptrend remains intact. Price action stays above these averages, confirming a bullish structure but with a flattening slope, signaling a pause in upward momentum.

Bollinger Bands show narrowing volatility after the recent surge, suggesting a consolidation phase. The gold line representing the Global Liquidity Index NDQ trends significantly above spot price, indicating abundant market liquidity, though the gap is narrowing slightly.

Silver Market Pauses as Technical Indicators Signal Consolidation

Technical oscillators underscore a cooling market. The MACD histogram shows convergence, with the signal line flattening and momentum waning.

RSI dropped to 55.61 after peaking above 60 last week, moving away from overbought territory but pointing to ongoing moderate bullishness. Key support stands at $37.49 and $37.09, with resistance at $38.51 and $38.11, as drawn by visible chart levels.

These correspond to recent price clusters and tops. The market respected these barriers throughout the last day. Fibonacci retracement analysis from the rally’s low to the recent high marks minor supports near $37.50 and $36.80, confirming price sensitivity at these levels.

Volume picked up on the Friday uptick but fell back during the overnight pause. On fundamentals, global silver supply remains in deficit for the fifth consecutive year, driven by high industrial demand from electronics and renewables.

Investment flows reflect continued concerns over inflation and central bank policy. Market sentiment hinges on the US CPI release and expectations of a coming Federal Reserve policy shift.

Asia tracks global moves, while London’s physical market stays tight on reduced above-ground stocks. Market makers report robust positioning but highlight reduced risk appetite before this key data.

The last 24 hours showcase a market recalibrating after strong gains, with investors pausing for macro clarity. Fundamentals point to resilient demand and contained downside risk, while technical signals favor further consolidation unless new catalysts emerge.

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