Silver Prices Gain 3.5 Percent On A Soft USD
- Silver prices rally by 3.5% as the Fed projects two rate hikes in 2016, crushing the USD.
- A break to this week’s high of $15.83 may open the door for further gains, while a failure to break the high may trigger a pullback in silver prices.
- U.S. Philadelphia Fed index and Jobless Claim figures are on tap as the U.S. session kicks-off.
Silver prices are higher by 3.5% since yesterday’s FOMC low. The Fed stunned the Dollar which caused it to soften against the majority of other metals and currencies and it is now projecting two rate hikes from four in December 2015 via the ‘dot plot.’
As highlighted yesterday, the March 10 low of $15.16 held as a support and traders used this position to recuperate the week’s losses, almost reaching the high of $15.83. Price is now trading at $15.76.
As the price momentum is strong, a breach to this week’s high of $15.84 may trigger further buying and this could lift price to the February 11 high of $15.97. Beyond the February 11 high, it is likely that the October 15 2015 high of $16.23 will come into play.
If silver prices fail to break the weekly high of $15.84, they may soften and the reason behind this is due to trades selling silver at the current levels over the last month. In this scenario, silver may test the other side of the current range of $15.16 – $15.84.
U.S. Philadelphia Fed index and Jobless Claim figures are on tap as the U.S. session opens. For the estimates and further economic indicators on tap today, see our economic calendar.
Silver Prices | FXCM: XAG/USD
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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