- Silver prices are drifting lower, and the trend is bearish
below the May 20 high of $16.63.
- The driver behind the latest few days of decline in silver
has been a speculation that the Fed will hike rates in
- Today, U.S. New Home Sales may gain by 2.3% MoM from a
decline of 1.5% in March. However, the outcome of the report
may have a limited impact on the price of silver, given that
it's not a crucial part of current Fed monetary policy.
Silver prices are short-term bearish below the May 20 high of
$16.63, and the trend is bearish below this high as it's a lower
high in relation to the previous high of $16.90 formed on April
19. In a downtrend similar to the current, the norm is for price
to drift lower, creating lower highs and lower lows, according to
classic technical analysis.
A near term resistance level is the high of $16.43, formed
yesterday afternoon in London. Support levels are today's London
morning low of $16.21, followed by the April 18 low of
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Silver Price | CFD: XAG/USD
Marketscope/Trading Station II
; prepared by Alejandro Zambrano
The driver behind the latest few days of decline to silver
prices is speculation of a Fed rate hike in June. According to
Fed Funds futures, the likelihood of a June 15 rate hike is now
at 32 percent, from being near 4 percent less than two weeks
Adding to the speculation of further rate hikes were
yesterday's comments by
Federal Reserve Bank of Philadelphia President
Patrick Harker, when he said he could 'easily see two, three rate
hikes in 2016'.
Comments by Fed member Williams, where also perceived as hawkish,
while comments by Bullard were more balanced.
Today, U.S. New Home Sales may have gained by 2.3% MoM from
declining by 1.5% in March. Looking at the actual number of new
homes sales, the expected outcome is for a rise from 511k to
523k. The trend has been upwards since 2011, when homes sales
reached a low of 267k. As this indicator is currently not a major
component of Fed monetary policy, the impact on silver prices may
--- Written by Alejandro Zambrano, Market Analyst for
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