Silver 1 OZ 999 NY (XAG=X) Prices to Challenge Key Resistance

Silver 1 OZ 999 NY (XAG=X) Prices to Challenge Key Resistance

Silver 1 OZ 999 NY (XAG=X) Prices to Challenge Key Resistance

Yesterday, the Federal Reserve cut interest rates to 1.75-2.00% as expected. However, the mixed outlook in regard to the future path of interest rates among the committee with 7/17 expecting rates to be lowered again slightly disappointed the dovish market expectations. Therefore, gold and silver prices slipped in the wake of the decision as markets interpreted this signal as hawkish.

US-China Trade Wars in Focus

With the Federal Reserve out of the way, much of the focus rests on between US and Chinese trade representatives, in which the outcome is likely to drive near-term price action for the precious metals complex. In the run up to China’s important political event in the form of the 70th anniversary of the Peoples Republic of China on October 1st, trade tensions have eased as both China and the US have provided good will gestures. Consequently, expectations of an interim trade deal between the two party have grown with reports in the South China Morning Post confirming as much. If indeed an interim trade deal were to come to fruition this could pressure safe-havens.

A support zone at $17.50-55 have underpinned the precious metal, however, with resistance at $18, gains could be somewhat limit unless risk sentiment sours.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 18.72.

The projected lower bound is: 16.94.

The projected closing price is: 17.83.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 32 white candles and 18 black candles for a net of 14 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 Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 48.5532. This is not an overbought or oversold reading. The last signal was a buy 3 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 50.42. 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 sell 10 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 -74. This is not a topping or bottoming area. The last signal was a buy 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 8 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAG= closed up 0.040 at 17.780. Volume was 8,900% above average (trending) and Bollinger Bands were 43% wider than normal.

Open     High      Low     Close     Volume___
17.800 17.940 17.580 17.780 49,055
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 17.91 17.18 15.69
Volatility: 33 32 22
Volume: 4,906 981 245

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.

Summary

PREC.M.XAG= is currently 13.3% above 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 into XAG= (bullish). Our trend forecasting oscillators are currently bearish on XAG= and have had this outlook for the last 0 periods.

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