Silver price is showing signs of a bullish pattern as SLV ETF inflows continue to increase. Despite a recent pullback, the price of silver remains significantly higher than its pandemic low and is nearing its highest level in ten years. Investors have been pouring money into the iShares Silver ETF, with net inflows of $1.3 billion this year and an additional $398 million in October. The rise in silver inflows is supported by positive fundamentals, such as increasing investments in clean energy, particularly solar energy, which relies on silver for manufacturing solar panels. However, the global manufacturing sector is under pressure due to contractionary PMI figures and a downward revision of global GDP outlook.
Two key catalysts for silver and the SLV ETF are on the horizon. The Federal Reserve will announce its interest rate decision this week, with expectations of a 0.25% cut. This follows a 0.50% rate cut in the previous meeting due to concerns about a deteriorating labor market. Additionally, the outcome of the US election between Kamala Harris and Donald Trump will have a significant impact on silver and other assets. With polls indicating a tight race, the presidential winner could spark market volatility.
In terms of technical analysis, the silver price chart indicates a break and retest pattern, suggesting a continuation of the uptrend. The price remains above the 50-week moving average, indicating current bullish control. The next key level to watch is $34.87, and a breakout above that level could confirm a bullish breakout and potentially push the price towards the key resistance level at $40. However, if silver experiences a recoil, it may retest the psychological level at $30, which was its highest swing on February 1, 2021.
Overall, the silver price is forming a bullish pattern supported by increasing SLV ETF inflows. Positive fundamentals in clean energy investments are balanced by challenges in the global manufacturing sector. The upcoming Federal Reserve interest rate decision and the US election will serve as key catalysts for silver and the SLV ETF. Technical analysis suggests a potential continuation of the uptrend, with a breakout above $34.87 indicating further gains, or a recoil towards $30 if the bullish momentum weakens.