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Silver Rallies Towards The $20.00 Level Despite Fed Rate Hike

By:
Vladimir Zernov
Updated: Sep 22, 2022, 09:43 UTC

Gold made an attempt to settle above $1685. WTI oil pulled back below the $85 level.

Silver

In this article:

Key Insights

  • Silver is up by almost 3% and looks ready to test the key resistance at the $20.00 level. 
  • WTI oil remains under pressure despite escalation of geopolitical tensions. 
  • Copper continues to get strong support in the $3.40 – $3.50 range. 

Silver Rallies After Fed Interest Rate Decision

Silver gained strong upside momentum as Fed Chair Jerome Powell started to speak at the press conference after the release of the FOMC statement.

The U.S. dollar tested new highs after the Fed increased the interest rate by 75 bps but lost momentum and pulled back. Treasury yields have pulled back as well. The yield of 2-year Treasuries, which made an attempt to settle above the 4.10% level, declined towards the 4.00% level.

Silver

Silver is trying to settle above the $19.70 level. In case this attempt is successful, it will move towards the next resistance, which is located at the recent highs at $20.00. A move above the $20.00 level will open the way to the test of the resistance at $20.30.

On the support side, a move below $19.70 will push silver towards the support at the 50 EMA at $19.50. In case silver declines below the 50 EMA, it will head towards the support level at the 20 EMA at $19.20. A successful test of this level will push silver towards the next support at $18.90.

Gold has also moved higher after an unsuccessful attempt to settle below $1655. Currently, gold is trying to settle above the $1685 level. Palladium is trading near the $2150 level, while platinum is stuck near $920.

WTI Oil Is Losing Ground On Demand Concerns

WTI oil pulled back below the $85 level as traders remained focused on potential problems with oil demand.

Russia’s decision to announce “partial mobilization” provided limited support to oil markets, which indicates that traders fear that aggressive central banks will hurt economic growth and put pressure on demand for oil.

Natural Gas Faced Strong Resistance Above $8.00

Natural gas made an attempt to settle above the $8.00 level but failed to develop additional upside momentum and pulled back towards $7.80.

From a big picture point of view, natural gas is trying to stabilize in the $7.60 – $8.00 range. In the European markets, natural gas prices continue to pull back due to reduced consumption. At this point, the situation in Europe has no direct impact on U.S. markets as Freeport LNG is not operational and the U.S. cannot increase natural gas exports.

Copper Continues To Trade Near $3.50

Copper moved below the $3.50 level but failed to develop significant downside momentum.

Support for copper in the $3.40 – $3.50 range remains strong, and it looks that copper markets will have a good chance to get back to the $3.60 – $3.70 level in case the U.S. dollar pulls back from highs.

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

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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