The US dollar and US treasury bond yields fell on Friday as silver increased and was on track to post its first weekly gain in four weeks. This was due to concerns raised by the US Nonfarm Payrolls report that the Federal Reserve would not continue raising interest rates past July. After the nonfarm payrolls, the likelihood of a Fed rate increase in November fell to 39% from 45%.
The Silver market is currently priced at $23.1038 and has ranged from a low of $22.6165 to a high of $23.1545 at the time of writing. But for the medium- and long-term, the following technical analysis, though with higher lows on a weekly basis, resulted in a bearish thesis since it is below the 20-day moving average.
The Silver Market (XAG/USD) From the Perspective of the Weekly Timeframe
On the weekly timeframe, Silver (XAG/USD) experienced a rejection of the bullish price around the $26.00000 level, resulting in a shift toward bearish sentiment. However, the market found strong support at the $22.42904 price level, leading to a bounce-back last week, which has continued into the current week.
It is worth noting that the price has remained below the 20-day moving average. indicating a bearish bias in the short term. Despite this, both last week and The current week have been characterized by decent bullish candles, suggesting potential strength in the market.
To gain For further insight, it would be beneficial to monitor the price action around the $26.00000 resistance level. If the price manages to break above this level and sustain its upward momentum, it could indicate a reversal of the bearish trend. In such a scenario, the 20-day moving average could act as a potential resistance level to watch.
The Silver Market (XAG/USD) from a Daily Chart Outlook
Following the bounce from the support level, the market displayed a period of indecision for approximately nine days. This consolidation phase suggests a lack of clear direction and uncertainty among market participants. It is essential to monitor the price action during this period, as it can often precede a significant move.
During this consolidation, the price approached the resistance level at $23.18584, which aligns with the 20-day moving average. The presence of the moving average as a resistance level indicates its significance in the current market dynamics. The market retraced from this level, suggesting that the moving average is acting as a hurdle for the price to overcome.
In the coming sessions, it will be crucial to observe how the market reacts around the 20-day moving average. A decisive break above this resistance level could indicate a potential bullish continuation, with the next resistance levels to monitor located around the previous swing highs.
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