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Silver Price Analysis: XAG/USD loses 1.0% after ECB, eyes on US CPI.

  • Silver fell to fresh weekly lows below its 21 DMA following the ECB announcement, but remains within recent ranges.
  • XAG/USD was last trading near $21.80, down 1.0%, as attention turns to Friday’s US CPI and next week’s Fed meeting.

Silver (XAG/USD) trades with a negative bias at weekly lows in the area of ​​$21.80 per troy ounce on Thursday, down around 1.0% on the day, following the ECB’s monetary policy announcement, which signaled a rise in prices. interest rates of 25 basis points next month, in addition to the end of QE and a possible increase of 50 basis points in September, depending on the evolution of the inflation outlook.

However, this leaves XAG/USD within recent ranges and support in the form of the 21-day moving average at $21.80 continues to hold. Therefore, silver is currently near the middle of a $21.50 to $22.50 range that has been in play since late May and traders will be watching US consumer price inflation data. Friday and next Wednesday’s Fed meeting to see if things shake up.

Silver bulls expect Friday’s inflation data to surprise to the downside and reinforce the idea that US inflation has peaked, thus Fed tightening bets likely to be reduced This would weigh on US and dollar yields, which are generally positive for precious metals.

Meanwhile, the Fed is expected to raise interest rates by 50 basis points at next week’s meeting (and again in July), so this should come as no surprise to silver. What will be more important is Fed Chairman Jerome Powell’s comment at the post-meeting press conference on the prospects for rate hikes beyond July.

If you start to sound a little more confident that inflation is going to recede from current highs/worried about the weakening US economy, then that, if CPI also surprises to the downside, could help XAG/USD rises to the $23.00 to $23.50 zone, where it would meet resistance in the form of its 50 and 200 day moving averages.

Technical levels


Last Price Today 21.62
Today’s Daily Change -0.44
Today’s Daily Change % -1.99
Today’s Daily Opening 22.06
20 Daily SMA 21.81
50 Daily SMA 23.08
100 Daily SMA 23.69
200 Daily SMA 23.48
Previous Daily High 22.25
Previous Daily Minimum 21.81
Previous Maximum Weekly 22.48
Previous Weekly Minimum 21.44
Monthly Prior Maximum 23.28
Previous Monthly Minimum 20.46
Daily Fibonacci 38.2% 21.98
Daily Fibonacci 61.8% 22.08
Daily Pivot Point S1 21.83
Daily Pivot Point S2 21.6
Daily Pivot Point S3 21.39
Daily Pivot Point R1 22.27
Daily Pivot Point R2 22.48
Daily Pivot Point R3 22.7

Source: Fx Street

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