Silver Price Analysis: XAG/USD rally stalls near $23 as focus shifts to US core PCE data

Silver price faces some pressure while attempting to extend rally above $23.
The market mood is downbeat as investors await the core PCE price index data for December.
Strong GDP numbers and stubborn inflation data could allow Fed to maintain a hawkish interest rate stance.

Sagar Dua FXStreet

Silver price (XAG/USD) struggles to extend upside above the crucial resistance of $23.00. The white metal turns sideways as investors shift focus towards the United States core Personal Consumption Expenditure (PCE) price index data for December, which will be published at 13:30 GMT.

S&P500 futures have posted significant losses in the European session, portraying a sharp decline in the risk-appetite of the market participants. The US Dollar Index (DXY) aims to recapture almost six-week high of 103.82 as safe-haven demand improves.

The US Q4 Gross Domestic Product (GDP) data, released on Thursday, indicated the economy grew at a robust pace of 3.3%. This has escalated upside risks to price pressures.

Meanwhile, investors await the US core PCE price index data. Investors have anticipated that the annual underlying inflation grew at a slower pace of 3.0% against reading of 3.2% in November. Monthly core PCE data is anticipated to rise by 0.2% after increasing by 0.1%.

A combination of stubborn inflation data and upbeat economic prospects would allow Federal Reserve (Fed) policymakers to stick to their hawkish interest rate stance atleast for the first-half of 2024.

Silver technical analysis

Silver price attempts to deliver a breakout of the Descending Triangle chart pattern formed on a four-hour scale. The downward-sloping trendline of the aforementioned chart pattern is plotted from 3 December 2023 high at $25.92 while the horizontal support is placed from 13 November 2023 low at $21.88. The asset has stabilized above the 20-period Exponential Moving Average (EMA), which trades around $22.73.

The 14-period Relative Strength Index (RSI) aims to stabilize into the 60.00-80.00 range. A bullish momentum would appear if the RSI (14) manages to do so.

Silver four-hour chart

XAG/USD

Overview
Today last price	22.86
Today Daily Change	-0.04
Today Daily Change %	-0.17
Today daily open	22.9

Trends
Daily SMA20	22.97
Daily SMA50	23.63
Daily SMA100	23.15
Daily SMA200	23.51

Levels
Previous Daily High	23.03
Previous Daily Low	22.64
Previous Weekly High	23.33
Previous Weekly Low	22.42
Previous Monthly High	25.92
Previous Monthly Low	22.51
Daily Fibonacci 38.2%	22.88
Daily Fibonacci 61.8%	22.79
Daily Pivot Point S1	22.68
Daily Pivot Point S2	22.47
Daily Pivot Point S3	22.29
Daily Pivot Point R1	23.07
Daily Pivot Point R2	23.24
Daily Pivot Point R3	23.46

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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