Silver Price Analysis: XAG/USD cracks to near $22.50 as US Dollar strengthens after upbeat US data
- Silver price drops vertically to near $22.40 after upbeat US Durable Goods Orders data.
- Fed Kashkari said more rates seem warranted and are needed to remain high to cool things off.
- The US Dollar Index extends its upside journey and prints an almost fresh 11-month high at 106.60.
Silver price (XAG/USD) plunged to near $22.45 in the early New York session after the release of the upbeat Durable Goods Orders data for August. The economic data surprisingly rose by 0.2% vs. expectations of a 0.5% decline. In July, Orders contracted sharply by 5.6% as the US manufacturing sector is going through tough times.
A surprise gain in Orders for core goods indicates that the demand outlook is improving and firms are digesting fears of higher interest rates from the Federal Reserve (Fed). US Manufacturing PMI has been consistently declining for a longer period and a surprise rise in core goods orders may improve factory activities, which would make the US economy more resilient.
Meanwhile, Minneapolis Fed Bank President Neel Kashkari said that there was a risk interest rates might have to go higher but added that it was hard to know. Earlier, Fed Governor Kashkari commented that the economy is fundamentally much stronger than projected. Therefore, more rates seem warranted and are needed to remain high to cool things off.
The US Dollar Index (DXY) extends its upside journey and prints an almost fresh 11-month high at 106.60. 10-year US Treasury yields recovered to near 4.54%.
Silver technical analysis
Silver extends downside to near the support zone plotted in a narrow range of $22.24-22.30 on a two-hour scale. Downward-sloping 20-period Exponential Moving Average (EMA) at $22.87 indicates that the short-term trend is bearish.
The Relative Strength Index (RSI) (14) shifts into the bearish range of 20.00-40.00, which warrants more downside.
Silver two-hour chart
Reprinted from FXStreet_id,the copyright all reserved by the original author.
Disclaimer: The content above represents only the views of the author or guest. It does not represent any views or positions of FOLLOWME and does not mean that FOLLOWME agrees with its statement or description, nor does it constitute any investment advice. For all actions taken by visitors based on information provided by the FOLLOWME community, the community does not assume any form of liability unless otherwise expressly promised in writing.
FOLLOWME Trading Community Website: https://www.followme.com
Hot
No comment on record. Start new comment.