Silver 1 OZ 999 NY (XAG=X) Key Support Level Is Tested While U.S. Dollar Rebounds
U.S. dollar is finally rebounding against the broad basket of currencies following days of downside, and this rebound is putting pressure on silver.
The U.S. Dollar Index, which has recently been close to the 104 level, has almost reached 98 before rebounding above 99. Gold prices are resisting this strength in the U.S. dollar and still show gains for the day, but silver is weaker than gold in the current crisis so it is already losing ground.
The U.S. has decided to extend virus containment measures until the end of April, which will put additional pressure on both the U.S. and the world economy. As silver is used in industrial production, such measures will lead to further decrease in demand for physical silver.
It remains to be seen whether any potential increase in investment demand could offset the declines in demand from various industries as the world heads into a material recession.
At this point, gold is the preferred safe haven asset among precious metals, and upside in silver typically requires positive dynamics on the gold price front. This situation will likely stay intact in the near term.
General market upside also plays an important role for silver. Currently, stocks are showing strength despite the alarming coronavirus numbers which have been accumulated over the weekend, but this may quickly change as the market situation is very fluid.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 15.51.
The projected upper bound is: 15.37.
The projected lower bound is: 12.61.
The projected closing price is: 13.99.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 70.5250. This is not an overbought or oversold reading. The last signal was a sell 0 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 39.58. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 5 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 24. This is not a topping or bottoming area. The last signal was a buy 7 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 3 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAG= closed down -0.054 at 14.061. Volume was 8,900% above average (trending) and Bollinger Bands were 246% wider than normal.
Open High Low Close Volume___
14.037 14.160 13.920 14.061 7,625
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 13.57 16.54 17.02
Volatility: 66 59 37
Volume: 763 153 38
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAG= is currently 17.4% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume out of XAG= (bearish). Our trend forecasting oscillators are currently bearish on XAG= and have had this outlook for the last 22 periods.