XAG / USD drops to $ 24.22 on comments from Fed Powell
- Silver falls from $ 24.85 to $ 24.20, according to Powell’s speech.
- Fed Powell confirms the reduction in QE and the decline in demand for metals.
- XAG / USD remains bullish with the focus on the USD 24.85 resistance area.
Silver futures have retreated from a level just below the two-month high of $ 24.87 and declined to the $ 24.20 area on the dollar’s bullish reaction to Fed Powel’s comments.
Metal prices die as Powell confirms QE reduction
Precious metals fell Friday to give away earlier gains after Fed chair Powell made a virtual appearance. Powell has confirmed the bank’s plan to reverse the bond purchases, but downplayed the idea of accelerating rate hikes.
Market reaction helped the dollar rebound, with the USD index gaining 0.2% after rising from session lows of 93.50 to high of 93.75 while equity markets and precious metals declined.
XAG / USD: Remains positive with focus on resistance at USD 24.85
Technical indicators remain fairly positive across the board, with silver futures likely to retest their early September highs at $ 24.80. If this level declines, the pair could pause before heading towards $ 25.20 (August 3rd and 4th lows) and April high at $ 26.00.
On the flip side, immediate support is at 24.10 (October 21st low) and below that, trendline support from the late September lows at now around $ 23.40 is maintaining the positive trend. Below that, the bears could gain momentum, dragging the pair to $ 23.00 (October 18 low) and $ 22.20 / 35 (October 6th and 12th lows).