Silver (XAG/USD) edges higher post-Fed bond taper announcement, up 0.13%, trading at $23.54 during the New York session at the time of writing. On Wednesday, the Federal Reserve revealed that it would reduce its bond purchasing program in the middle of November. Furthermore, leave the door open that would adjust the pace of its QE reduction program as the central bank’s needed.

It seems investors perceived the US central bank bond tapering announcement as dovish, as portrayed by US equities printing new all-time highs around the New York close. 

On Wednesday, after revealing the Fed’s QE reduction pace to kick start later in November, Fed’s Chairman Jerome Powell held its press conference. There he said that the central bank could be patient in regards to hiking rates. Further added that in case of needing to tackle heightened prices, he said, “we will not hesitate,” after announcing the scale back by $15 billion of its bond purchasing program.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

The white metal is approaching the tops of a bullish flag pattern in the 4-hour chart. Furthermore, the precious metal bounced off the 200-simple moving average (SMA) around $23.09, and rallied $0.50, as the Fed announced the bond taper. Nevertheless, to resume its upward trend, it would need to reclaim the 100-SMA at $23.73.

In the outcome of the above-mentioned, the following resistance area would be the confluence of the $24.00 psychological level and the  50-SMA. A breach of that level could send silver towards 2021 highs around $24.85.

On the flip side, failure at $23.73 would keep USD bulls in control, exposing the $23.00 figure as the first support level before re-testing the $22.00 figure.

Silver going short on interday chart

Nov 04 2021