- The price of silver continues its losing streak of five days against the strength of the US dollar.
- The attractiveness of the US dollar has improved as fears of a recession in the US economy are mild.
- Silver price corrects vertically to approach the 200 day EMA, which is trading around $23.30.
The price of the Silver (XAG/USD) continues its five-day losing streak after falling below Tuesday’s low of $23.48 early in the New York session. The white metal faces a lot of selling interest as the US dollar continues to hold up on deepening global recession fears.
Investors continue to pump money into the dollar as developing economies are expected to report a recession due to the tightening monetary policy of Western central banks. The attractiveness of the US dollar has improved as fears of a recession in the US economy are mild. Disappointing Chinese economic growth is the main driver of the US dollar’s strength.
The S&P 500 opens negative as market sentiment remains bearish due to global uncertainties. The Dollar Index (DXY) is gathering strength for a further rally and is expected to extend gains above the immediate resistance at 105.00. Investors should prepare for action in the US dollar after the release of the US ISM services PMI for August, due at 14:00 GMT.
Meanwhile, Boston Fed President Susan Collins commented on the interest rate outlook and that future action will be based on incoming data. Fed Collins expects a slowdown in the coming months and the central bank is far from containing inflation.
Silver Technical Analysis
The price of silver corrects vertically until it approaches the 200-day Exponential Moving Average (EMA), which is trading around $23.30. The white metal forms a head and shoulders chart pattern, which is a bearish reversal pattern. The neckline of this formation is from the June 22 low at $22.18.
The Relative Strength Index (RSI) (14) falls to near 40.00. A bearish momentum would be triggered if it breaks below it.
daily chart
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
