- Silver prices extend their rally to levels above $19.00.
- US dollar slumps on Fed easing speculation.
- XAG/USD is now at a key resistance zone at $19.30.
silver prices they have extended Thursday’s bounce from $18.30 lows on Friday, breaking above $19.00 and hitting 1-week highs at $19.30. The precious metal appreciates more than 3% on the day, recovering half of the ground lost in the previous week’s sell-off.
Precious metals appreciate against a weaker dollar
A Wall Street Journal report has suggested that Federal Reserve officials are open to debate on how to signal a smaller rate hike in December. This has offset the positive impact of the bank representative’s hawkish rhetoric and sent the US dollar down across the board.
In addition, an alleged intervention by the Bank of Japan and the Japanese Ministry of Finance has caused the yen to skyrocket across the board. As a consequence, USD/JPY tumbled more than 2.5% and weighed on the US dollar overall.
XAG/USD is pressing against a key resistance at $19.30.
From a technical point of view, the pair is testing the $19.30 resistance zone (Oct 13 high and 38.7% retracement of Oct 4-10 dip). Above this zone, the next potential targets are $19.65 (50% retracement and Oct 11 high) and the $20.00 level.
On the downside, below the previous $19.00 resistance zone, the next potential targets could be the 4hrs 20-SMA, now at $18.60, and the Oct 14 low at $18.08.
XAG/USD 4-hour chart
Technical levels to watch
Source: Fx Street
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