XAGUSD Silver Prices
Our last Silver (XAG-USD) price prediction is still valid, as bulls have thwarted another bearish attempt to take the price below $20. XAG/USD price is expected to remain volatile in this week as Jerome Powell is set to testify in Congress. The hawkish comments from the FedChair can adversely affect global commodity prices.
The ongoing correction in Silver and Gold prices also corresponds to the bounce in DXY Index. The dollar strength index has been surging since the start of February amid hawkish Fed comments and unsatisfactory inflation reports. Consequently, global equities and other speculative assets are showing a negative price action.
This month is flooded with events that can affect XAG/USD prices. The upcoming appearance of Jerome Powell in US Congress, along with the release of the CPI report, will keep the Silver price in check for the next two weeks. Once these events are over, the price will remain volatile as the 22nd March FOMC meeting will be approaching.
The CPI and PCE inflation reports in the last month have surprised most of analysts. As a result, the analysts, which were affecting just another two rate hikes this year, are expecting more tightening. In March 2023 FOMC meeting, US Federal reserve can increase the interest rates by another 50 basis points. Anything less than this figure will be bullish for asset prices.
As mentioned above, the XAG/USD chart shows an inverse correlation with the DXY chart. As soon as the dollar shows some signs of weakness, we can see a nice rally in Gold and Silver. On Monday, the Silver price per ounce dipped below the last week’s closing but crawled back above to remain green. At press time, the price is trading at $21.26 after showing minor gains of 0.15%.
The following chart reveals a few key levels to watch. It can be seen the price bounced off the 200-day moving average after briefly dipping below it. Our Silver price prediction will remain bullish as long as the price stays above 200-day MA. Another daily closure below this level will be very bearish.
Therefore, $20.96 will be a critical level to hold. A significant bounce from this level can allow bulls to target the year high of $24.5 that was made in February.
This post was last modified on Mar 06, 2023, 07:27 GMT 07:27