Silver Video 16.09.20.
Silver Gains Ground Ahead Of Fed Interest Rate Decision
The U.S. Dollar Index is once again trying to settle below the 93 level. In case this attempt is successful, the U.S. Dollar Index will gain more downside momentum and head towards the next significant support level at 92.50. A weaker dollar is bullish for silver as it makes it cheaper for buyers who have other currencies.
I’d note that the situation may change quickly after Fed Interest Rate Decision and the subsequent press conference so silver traders should be prepared for fast moves.
Meanwhile, gold is testing the nearest resistance level at $1975. If this test is successful, gold will head towards the test of the major resistance level at $2000, which will be bullish for silver.
Gold/silver ratio is little changed and remains in a tight range between 71 and 73. There was little action in gold/silver ratio in recent trading sessions but traders should keep a close eye on both the support at 71 and the resistance at 73 as a potential breakout may have a significant impact on silver’s trading dynamics.
Currently, silver is moving towards the nearest resistance level at $27.75. Yesterday, silver made an attempt to get to the test of this level, but this attempt was stopped at $27.60.
If silver manages to settle above $27.75, it will gain upside momentum and move towards the next resistance level at $28.50. If this move happens after the U.S. Fed Interest Rate Decision which typically increases market volatility, silver may quickly reach the resistance at $28.50.
In case silver gets above $28.50, it will have to deal with the next resistance at $28.90. The resistance at $28.90 is the last notable resistance level on the way to multi-year highs at $29.85.
On the support side, the 20 EMA at $26.85 continues to serve as the first important support level for silver. A move below the 20 EMA may trigger a sell-off which may take silver closer to the next support level at $25.85.
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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