FX.co ★ XAG/USD, SILVER

Silver (XAG/USD) is falling about 1.75% to trade near $65.61 amid European trading on Tuesday. Silver is under selling pressure amid Federal Reserve concerns that strong demand is posing upside risks to inflation, compounded by rising prices. This is not the case when inflation comes from the supply side, such as energy supply shocks. On Monday, Austan Goolsbee, president of the Chicago Federal Reserve Bank, said high demand could be a reason for the rise in inflation, apart from energy costs, tariffs, and other supply shocks. Over the weekend, Neel Kashkari, president of the Minneapolis Federal Reserve Bank, noted that high inflation is an important consideration for policymakers, adding that the high price pressures are not only due to high oil prices. At present, according to CME FedWatch, there is a close to 90% chance that the Federal Reserve will raise interest rates at least once this year. Moreover, market participants are focusing on the meeting between the leaders of the US and Gulf nations taking place alongside the United Nations General Assembly in New York. The meeting aims to discuss ways to increase oil production in the Middle East. On the daily chart for the XAG/USD pair, the current price is around $65.61. Overall, the near-term outlook remains bearish as price struggled to move higher amid resistance from the 20-day EMA at $65.18. Now, price has breached the initial resistance at the () and is consolidating at the 20-day EMA at $65.18, above it. The shorter-term bias has now shifted into bulls' favour. Price is currently near the broken downward resistance trend line, while the RSI(14) is around 50, reflecting neutral momentum. This neutral momentum is not enough to push through the existing technical resistance. On the topside, the first resistance zone is at $65.90, which continues to restrict near-term rallies. To the downside, the previous resistance trendline turned support at $64.26 is the first level of concern, as a daily break of this area will most likely open XAG/USD for selling activity.