Bullish US Dollar is going to be a problem for Silver
Since the 2020 bottom, most Commodities have risen to all time highs based on higher inflation expectations following massive QE by the Fed. On the contrary, QE is having trouble pushing for a faster recovery with Covid19 still spreading around the world.
The US CPI has been struggling to rise with the 10 year bond yield just below the 1.7% level. The US Fed has reiterated that it wants inflation to stay above 2% for a while before tightening monetary policies. Therefore, the markets have decided to test the FED by playing along the reflation trade (cyclical growth equities). This has pushed rates higher and could rise higher in the future.
With a recovering economy, the dollar has turned bullish in the short term and is expected to move higher. This will hurt commodity prices.
Silver has broken below it's 200-day moving average. This could mean trouble for bullish traders. A continuation Flag could offer confluence to the idea.
If silver confirms the moving average breakout, I'll be opening short positions with the November 2020 pivot low being a my first Target 🎯
The US CPI has been struggling to rise with the 10 year bond yield just below the 1.7% level. The US Fed has reiterated that it wants inflation to stay above 2% for a while before tightening monetary policies. Therefore, the markets have decided to test the FED by playing along the reflation trade (cyclical growth equities). This has pushed rates higher and could rise higher in the future.
With a recovering economy, the dollar has turned bullish in the short term and is expected to move higher. This will hurt commodity prices.
Silver has broken below it's 200-day moving average. This could mean trouble for bullish traders. A continuation Flag could offer confluence to the idea.
If silver confirms the moving average breakout, I'll be opening short positions with the November 2020 pivot low being a my first Target 🎯
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