Silver Price Analysis: XAG/USD stabilizes after a sell-off above $24 as US PCE softens further

Silver finds stabilization after a sell-off to near $24.00 amid strength in the US Dollar.
The US core PCE price index gained at a pace of 0.2% in June as expected by the market participants.
Silver price delivers a breakdown of the Double Top chart pattern formed above $25.00.

Sagar Dua FXStreet

Silver price (XAG/USD) remains topsy-turvy above the crucial support of $24.00 in the New York session. The white metal struggles to find direction as investors need strong cues about September’s monetary policy by the Federal Reserve (Fed) as policymakers held incoming data accountable for further action.

S&P500 opens on a bullish note as fears of a recession in the United States have faded significantly. Considering the stellar performance of the US economy in the April-June quarter and commentary from Fed officials that they are not expecting a recession due to the tight labor market, investors find strength for pumping money into US equities.

The US Dollar Index (DXY) rebounds firmly after correcting to near 101.40 as soft US core Personal Consumption Expenditure (PCE) price index data fails to offset the impact of upbeat Gross Domestic Product (GDP) data.

The US core PCE price index gained at a pace of 0.2% in June as expected by the market participants but remained slower than the 0.3% figure, being registered in May. On an annualized basis, Federal Reserve’s (Fed) preferred inflation tool softened sharply to 4.1% vs. the expectations of 4.2% and the former release of 4.6%.

Silver technical analysis

Silver price delivers a breakdown of the Double Top chart pattern formed above $25.00 on a two-hour scale. The aforementioned pattern was triggered after slipping below July 24 low at $24.27 and a bearish reversal has been triggered. The 20-period Exponential Moving Average (EMA) at $24.40 is acting as a barricade for the Silver bulls.

The Relative Strength Index (RSI) (14) has shifted into the bearish range of 20.00-40.00, which indicates that the bearish momentum is active.

Silver two-hour chart

XAG/USD

Overview
Today last price	24.23
Today Daily Change	0.10
Today Daily Change %	0.41
Today daily open	24.13

Trends
Daily SMA20	24.01
Daily SMA50	23.64
Daily SMA100	23.88
Daily SMA200	23.03

Levels
Previous Daily High	25.15
Previous Daily Low	24.04
Previous Weekly High	25.27
Previous Weekly Low	24.59
Previous Monthly High	24.53
Previous Monthly Low	22.11
Daily Fibonacci 38.2%	24.47
Daily Fibonacci 61.8%	24.73
Daily Pivot Point S1	23.73
Daily Pivot Point S2	23.34
Daily Pivot Point S3	22.63
Daily Pivot Point R1	24.84
Daily Pivot Point R2	25.54
Daily Pivot Point R3	25.94

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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