Silver Price Analysis: XAG/USD traders await the Fed


  • Silver is holding in bullish territory but is vulnerable.
  • All attention is on the Fed for the days ahead.

The price of silver is trading flat in early Asia following a semi bearish close on Wall Street. XAG/USD was lower by some 0.27% by the close of the US session but performing better than gold. The gold to silver ratio was down by 0.36%.

Traders are now looking ahead to the Federal Open Market Committee that will meet on Tuesday. A statement followed by the Fed’s Chair, Jerome Powell, speaking in a presser will be what to watch for. 

The Fed Powell will be expected to say that the most likely course is that inflation decelerates over the coming months, settling back at more normal levels later this year. Therefore, the transitory mantra should keep a lid on the US dollar and help to underpin a recovery in precious metal prices.  On the other hand, if there are upward revisions for PCE inflation in 2021 then this could be feeding through to a more sustained rise in inflation over the medium term. This would be more hawkish than what the markets are priced for.

Silver technical analysis

A spike in the greenback will expose the vulnerability of the 27 figure and prior daily lows that meet the bullish 10-day moving average. 

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