XAG/USD Stalls in Anticipation of Stimulus End result

Silver Outlook:

• XAG/USD Stalls in Anticipation of Stimulus End result
• CCI Nears Overbought Territory
• Silver trades above 50 interval MA, for now

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Value Motion Stalls as Stimulus Talks Proceed

Renewed hopes of extra US stimulus mixed with financial uncertainty elevated the demand for Gold, Silver and different safe-haven belongingsquickly, earlier than retracing again into its rangebound state.

From a long-term perspective, the month-to-month chart under highlights how the Fibonacci ranges from the historic transfer (taken from September 2008 low to March 2011 excessive) have shaped assist and resistance for the valuable metallic, forming areas of confluency for value motion since recovering from March 2020 lows, which marks the low of the second Fibonacci (purple), with the excessive marked at 2983.9 (7 August 2020 excessive).

Silver Month-to-month Chart

Chart ready by Tammy Da Costa, IG

CCI Approaches Overbought Territory

For these centered on short-term strikes, the Commodity Channel Index (CCI), which measures the worth of an asset compared to its common over a sure time frame, is approaching 100, a doable indication that the worth of silver could also be getting into into overbought territory. In the meantime, costs are buying and selling simply above the 50-period Transferring Common (MA).

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Silver four Hour Chart

Chart ready by Tammy Da Costa, IG

Silver Technique Transferring Ahead

For now, the 61.8% Fibonacci retracement of the historic transfer continues to carry as assist at 2427, with a break under presumably bringing the 38.2% retracement stage of the short-term transfer into play at 2276.1.

On the other finish, the 23.6% retracement stage of the short-term transfer holds as resistance at 2546, with the subsequent stage of resistance holding on the psychological stage of 2600.

— Written by Tammy Da Costa, Market Author for DailyFX.com

Contact and comply with Tammy on Twitter: @Tams707