Silver investment: has the market changed direction again?! Global economic restart hopes to become the main melody! Silver prices continue to rise!

In Asian session on Tuesday (May 26), spot silver remained firm above its 200-day moving average and is currently trading around $17.40, keeping an eye on market risk sentiment.

Silver prices fell below the $17 mark the previous day as tensions between China and the United States soured sentiment, but recovered most of their losses before closing just above $17.

Worldometers world real-time statistics show that as of 11:35 Beijing time on May 26, the global total number of confirmed covid-19 cases exceeded 5.58 million, reaching 5,589,712, and the total number of deaths exceeded 347,903, exceeding 347,000.

Among them, the cumulative number of confirmed covid-19 cases in the United States exceeded 1.7 million, reaching 1,706,226, and the cumulative number of deaths approached 100,000, reaching 99,805. Both confirmed cases and deaths are the largest in the world.

Risk sentiment improved sharply on Tuesday as Japan lifted its state of emergency and investors began to ignore trade tensions with the U.S. for a while, turning to China for more stimulus and a return to an open global economy.

Yi gang, governor of the people’s bank of China, said recently that a prudent monetary policy will be more flexible and appropriate. We will steadily merge benchmark interest rates on deposits and loans with market rates.

Going forward, the people’s bank of China will continue to deepen the reform of LPR, unblock the transmission channel from the money market interest rate to the lending rate, push for a reduction in the real lending rate and support the development of the real economy, yi said. At the same time, we will promote the orderly conversion of existing loan benchmarks.

In addition, on Tuesday, May 26, 2020, the people’s Bank of China will launch the fifth central bank bill swap (CBS) operation in 2020. The operation volume of this period is 5 billion yuan, with a period of 3 months. The fixed-rate quantity bidding is conducted for primary dealers of open market business, with a rate of 0.10%. The first settlement date is May 26, 2020, and the due date is August 26, 2020 (postponed in case of holidays).

Meanwhile, bank of Japan governor haruhiko kuroda also “propaganda” to stabilize the market. Mr Kuroda said he would not hesitate to relax measures if needed in the fight against the outbreak. Funding businesses and maintaining market stability are critical. The central bank is closely watching the economic impact of the outbreak.

Rodrigo Catril, the senior currency strategist at National Australia bank, said: “Despite the backdrop of continuing tensions between China and the us, equity investors seem more interested in the prospect of a global economic reset. In terms of restarting the economy, Japan lifted its state of emergency, people in Madrid can go to bars wearing masks and some businesses in England will reopen on June 1.”

Technical analysis:

The dollar

On the daily chart, the U.S. dollar index in the last day after the close of a small pressure, trading around 99.65, the current overall hovering between the 60 and 50 moving average. From a technical point of view, the MACD green kinetic energy column gradually weakened and the KDJ random index hovered below the 50 level, suggesting that short dollar momentum remains and gains are limited.

As can be seen from the 4-hour chart, the U.S. dollar index fell after hitting a high of 99.98 and continued to fall, highlighting the resistance to the 100 mark. It is now trading slightly above its 20-day moving average. The MACD red kinetic energy column continued to contract and the KDJ random index fell below the 50 level, indicating long dollar momentum has weakened and there is still room for a pullback.

silver

On the daily charts, silver has remained firm above its 200-day moving average, and has been trading around the $17 level recently. We are looking to see if we can close above that level. The MACD red kinetic energy column weakened slightly, and the KDJ stochastic index hit overbought levels down, suggesting silver bulls lost momentum and could begin a pullback.

On the four-hour chart, silver continued to rally after hitting a low of $16.69 and is now pushing its intraday high to $17.45, with an eye on breaking through the $17.63 resistance. MACD green momentum continued to weaken and KDJ stochastic hit an overbought level on the upside, indicating silver bears lost momentum and watched to see if the rally could be sustained.

Fundamental positive factors:

  1. Worldometers world real-time statistics show that, as of 11:35 on May 26, Beijing time, the global total number of confirmed covid-19 cases exceeded 5.58 million, reaching 5,589,712, and the total number of deaths exceeded 347,903, exceeding 347,000.
  2. Michael Ryan, head of who’s health emergencies programme, said it was a dangerous assumption to assume that the current decline in infections reflected the natural seasonality of a disease and that the next danger point could be October or November. He stressed that if the virus is allowed to overtake us again and no system is in place to beat it, there is a risk of a second peak.
  3. Who director-general tedros adhanom ghebrev said the who had halted research into hydroxychloroquine as a potential novel coronavirus treatment in the solidarity trial because of safety concerns.
  4. Robert O ‘brien, us national security adviser, said on Sunday that China’s proposed security legislation for Hong Kong could trigger us sanctions and threaten the city’s status as a financial centre.

Fundamental negative factors:

  1. The Japanese government on Monday lifted the state of emergency and will decide on a second supplementary budget on Wednesday to help individuals and businesses hit by the outbreak.
  2. A survey by Ifo, a German think tank, showed that German business confidence rebounded in May after falling sharply the previous month, and business activity gradually returned to normal after weeks of coronavirus-related restrictions.
  3. On May 25, local time, British prime minister Boris Johnson said that today confirmed that Britain can enter the second phase of the relaxation; Some schools will open on June 1st as planned; We’re fighting viruses; A vaccine-related press conference will be held in June, and recent signs of confidence that a vaccine will be ready this year have increased.
  1. The lancet, an international academic journal, published online the results of the world’s first phase I clinical trial of recombinant adenovirus type 5 vector covid-19 vaccine. The corresponding author of the paper was Chen wei, an academician of the Chinese academy of engineering. The study showed that the covid-19 vaccine, carried by adenovirus Ad5, showed both immunogenicity and human tolerance at 28 days after inoculation, the paper said.

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