Silver Price Analysis: XAG/USD Finds Support Near $22.50, Downside Remains Intact
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- Silver price gauges an interim cushion near $22.50, more downside looks likely as Fed rate cut bets ease.
- Strong US consumer spending has dented hopes of rate cut by the Fed in March.
- Silver price hovers near the horizontal support of the descending triangle chart pattern.
Silver price (XAG/USD) discovers an intermediate support after a sharp correction to nearly $22.50 in the late Asian session. The near-term demand for the white metal is still downbeat as trades have pared bets supporting a rate cut by the Federal Reserve (Fed) in March.
S&P500 futures have posted nominal losses on board in Tokyo, portraying a further decline in the risk appetite of the market participants. The US Dollar Index (DXY) has corrected to near 103.25 after failing to extend a rally above a fresh monthly high of 103.63. 10-year US Treasury yields have eased slightly to near 4.1%.
Investors are losing conviction towards an interest rate cut by the Fed in the March monetary policy meeting due to the absence of support from United States economic indicators. After a stubborn inflation report for December, Retail Sales data outperformed the market consensus. The US consumer spending rose at a stronger pace of 0.6% against expectations of 0.4% and the prior reading of 0.3%.
Strong US Retail Sales were prompted by robust demand for motor vehicles and online purchases. Considering resilience in the US economy, Fed Governor Christopher Waller advised the need to maintain a ‘careful and methodical’ approach while reducing interest rates.
Silver technical analysis
Silver price trades near the horizontal support of the Descending Triangle chart pattern formed on a four-hour scale, which is around December 13 low of $22.50. The downward-sloping trendline of the aforementioned chart pattern is plotted from December 3 high at $25.92.
The 50-period Exponential Moving Average (EMA) around $23.00 continues to act as a barricade for the Silver price bulls.
Meanwhile, the 14-period Relative Strength Index (RSI) has slipped into the bearish range of 20.00-40.00, which indicates that a bearish momentum has been triggered.
Silver four-hour chart
XAG/USD
OVERVIEW | |
---|---|
Today last price | 22.59 |
Today Daily Change | 0.03 |
Today Daily Change % | 0.13 |
Today daily open | 22.56 |
TRENDS | |
---|---|
Daily SMA20 | 23.46 |
Daily SMA50 | 23.67 |
Daily SMA100 | 23.22 |
Daily SMA200 | 23.59 |
LEVELS | |
---|---|
Previous Daily High | 22.95 |
Previous Daily Low | 22.51 |
Previous Weekly High | 23.53 |
Previous Weekly Low | 22.48 |
Previous Monthly High | 25.92 |
Previous Monthly Low | 22.51 |
Daily Fibonacci 38.2% | 22.68 |
Daily Fibonacci 61.8% | 22.78 |
Daily Pivot Point S1 | 22.4 |
Daily Pivot Point S2 | 22.23 |
Daily Pivot Point S3 | 21.95 |
Daily Pivot Point R1 | 22.84 |
Daily Pivot Point R2 | 23.12 |
Daily Pivot Point R3 | 23.28 |
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