Silver Price Forecast: XAG/USD faces resistance near $23.50 as focus shifts to Jackson Hole

Silver price (XAG/USD) faces fragile barricades around $23.50 after a sharp recovery in the early New York session. The white metal struggles to extend recovery as the US Dollar rebounds after remaining lackluster. The US Dollar attracts some bets amid caution ahead of the Jackson Hole Symposium, which will start on Thursday.

S&P500 is expected to open on a positive note, following positive cues from overnight futures. US equities find interest despite Moody’s and S&P Global downgrading the credit ratings of US commercial banks, citing risks of rising outflows in a high-interest rate environment. The 10-year US Treasury yields oscillate above 4.3%.

The US Dollar Index (DXY) recovers sharply and is looking to test the immediate resistance of 103.50 as Federal Reserve (Fed) chair Jerome Powell at Jackson Hole is likely to deliver a hawkish commentary. Fed Powell is expected to keep interest rates higher for a longer period as United States inflationary pressures are still far from the desired rate of 2%.

Meanwhile, Richmond Fed President Thomas Barkin said on Tuesday that the Fed needs to achieve the 2% inflation target to ensure its credibility, per Reuters. Fed Barkin expects that the US recession will be a ‘less severe’ one.

Silver technical analysis

Silver price finds an intermediate resistance after a solid recovery to near the 38.2% Fibonacci retracement (plotted from July 20 high at $25.27 to August 15 low at $22.23) at $23.40. The asset shifts auction above the 20-period Exponential Moving Average (EMA), which trades around $23.20.

The Relative Strength Index (RSI) (14) climbs into the bullish range of 60.00-80.00, which indicates more upside ahead.

Silver hourly chart