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Silver Price Daily Forecast – Silver Tests Support At $23.30 Amid Global Market Sell-Off

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Silver Video 28.10.20.

Strong U.S. Dollar Puts Significant Pressure On Silver

Silver gained strong downside momentum and is testing the support level at $23.30 as the U.S. dollar is moving higher against a broad basket of currencies amid fears about a second wave of lockdowns in Europe.

The U.S. Dollar Index gained strong upside momentum and managed to settle above the 20 EMA at 93.30. Currently, the U.S. Dollar Index is testing the next resistance level at the 50 EMA at 93.55.

If the U.S. Dollar Index manages to settle above the 50 EMA, it will head towards the 94 level which will be bearish for silver. A strong dollar is a negative catalyst for silver and other precious metals as it makes them more expensive for buyers who have other currencies.

Gold is also under pressure and is currently trying to settle below the $1900 level. If gold declines below the nearest support level at $1875, and will gain additional downside momentum and put more pressure on silver.

Meanwhile, gold/silver ratio has managed to get above the 50 EMA at 78.30 and is trying to settle above the 80 level. If this attempt is successful, gold/silver ratio will move towards the resistance at 81.50 which will be bearish for silver.

Technical Analysis

Silver gained significant downside momentum after it managed to settle below the support at $23.90 and is testing the next support level at $23.30. RSI is still in the moderate territory so there is plenty of room to develop additional momentum in case the right catalysts emerge.

If silver settles below the support at $23.30, it will continue its downside move and head towards October lows at $22.90. A move below this level will open the way to the test of the next support at $22.30.

On the upside, the previous support at $23.90 will likely serve as the first resistance level for silver. A move above this level will push silver towards the major resistance level at the 50 EMA at $24.50. If silver manages to settle above the 50 EMA, it will get back to its previous upside mode.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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