The Slide in Silver Prices Slows Following Support
- • Silver prices reach the $16.30 support level, which slowed following the decline.
- The short-term trend is bearish below the intraday high of $17.14 formed in the afternoon of May 18.
- U.S. Existing Homes Sales is the only indicator on deck but it is not a market-moving event.
Silver prices remain in a clear downtrend below the intraday high of $17.14 formed in the afternoon of May 18. The nearest strong resistance level is the March 25 low of $16.78, which also was the same level supporting price from April 25 to May 18. Given that it was a critical support level then, it may now have turned into a critical resistance level.
The nearest support level is the April 18 high of $16.30, followed by the April 18 low of $16.09 and the April 14 low of $15.89. The genial driver over the last few days has been the USD, which has been gaining as the most recent FOMC minutes and comments from Fed members have been supporting the idea of the Fed being ready to raise rates sooner than the market might expect.
The next rate meeting will take place on June 15 and the likelihood of a higher rate following the meeting is 28% as per the Fed Funds’ Future forecast.
Our forecasts for Q2 2016 are live on the site. Download them for free.
Silver Price | CFD: XAG/USD
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
The only economic event on deck today is U.S. Existing Homes Sales and the may gain by 1.3% from March to April, which follows a prior gain of 5.1%. As it is currently not a critical variable for the Fed in setting their monetary policy silvers reaction to it could be muted.
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.