Silver prices attempted to move higher in tandem with gold but could not gain traction and closed near the open of the trading session. The trend is downward sloping. Silver prices closed down 7.23% for the week. This drop followed Silver prices tumbling on Thursday, breaking through support levels. The dollar continued to rally following the Fed’s more hawkish than an expected commentary on Wednesday, as 7-Fed governors now expect the Fed to raise rates in 2022. The Fed’s Bullard did an interview with CNBC today where he said that the Fed’s comments were meant to be hawkish and believe there will be a rate hike in 2022.
Technical Analysis
Silver prices attempted to move higher but failed and broke down and are poised to test lower levels. Support is seen near an upwards sloping trend line that comes in near $25.07. Resistance is seen near the 50-day moving average at 27.02. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line. The MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices.
The hawkish tone of the Fed was reiterated on Friday as the St. Louis Federal Reserve President James Bullard told CNBC that he sees an initial interest rate increase in late-2022 as inflation picks up faster than previous forecasts. Bullard at several points, described the Fed’s moves this week as hawkish or in favor of the tighter monetary policy.
This article was originally posted on FX Empire