Silver Price Collapses Under USD Strength As FOMC Turns Hawkish

Summary:

The FOMC provided hawkish projections on Wednesday after its rate decision, causing a collapse in silver prices (XAG/USD).

Following the hammer blow that the FOMC delivered to USD sellers yesterday, silver prices plummeted yet again, losing nearly 2.62% after Wednesday’s 2.64% drop.

This move sent silver prices to 6-week lows post-FOMC, after the bank projected that the recovery conditions that would enable lift-off and tapering would come earlier than once thought. Furthermore, more members of the governing council of the Fed saw a 2022 lift-off date than was the case in the March meeting.

Silver price is now on the path to a 5th straight day of losses after having topped out at $28.28 on 11 June.

Technical levels to Watch

The daily candle has found support at the 26.325 mark, but this support level remains under pressure from sellers. A breakdown of this support opens the gates for sellers to aim at 26.034. This move also lines up 25.386 and 24.569 as potential additional targets to the south.

On the flip side, a retracement rally from a bounce on the current support could target 26.624 and 26.868 before renewed selling on the pair occurs if the sentiment continues to favour USD strength.