Silver Price Analysis – Silver Stalls Below $60 Resistance Ahead of Fed

Silver Technical Analysis

The silver market continues to show signs of weakness early on Wednesday as traders continue to see a lot of action just below the $60 level. Keep in mind that Wednesday is a Federal Reserve interest rate decision day, and that means volatility. There’s about a 40% chance, based on the FedWatch tool on the likelihood of an interest rate hike, which means there’s going to be a significant amount of the market that’s not happy with the decision. With that, volatility will be more likely than not to pick up.

Death Cross and Key Resistance Levels Weigh on Silver

The $60 level is a large round, psychologically significant figure and an area that recently has turned into resistance. The 50-day EMA breaking down below the 200-day EMA also kicked off the so-called death cross about 2 weeks ago, which is also a very negative indicator.

To the downside, the $55 level has offered support, and $50 has been important multiple times in the past, going all the way back to the late ’70s, early ’80s, when the Hunt brothers tried to corner the silver market. It was also important during the Great Financial Crisis, and recently we had broken through it for the first time cleanly in history. Now the question is, will we pull back and retest that for support? It’s an area that I think a lot of traders will be watching. As things stand right now, the volatility is likely to pick up, but the downward pressure is still a very real thing.

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