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XAGUSD Regained Leadership in Swap Dealer Positions

12/15/2022 11:08 AM

After two sessions of active growth, which brought silver to local highs from April 25, during the Asian session, the XAG/USD pair is steadily declining, renewing local lows from December 12 and testing 23.20 for a breakdown.

The focus of investors is on the results of the two-day meeting of the US Federal Reserve: the regulator raised the interest rate by 50.0 basis points to 4.25–4.50% and increased the forecast for the maximum level of the indicator for 2023 to 5.00%. In an accompanying statement, the head of the department, Jerome Powell, noted the expediency of maintaining high rates until inflation returns to the target levels of 2.0%. Domestic prices rose by 7.1% in November, slowing down from a 7.7% increase in October: real dynamics outperformed market forecasts of 7.3%, signaling that the national economy could recover faster than expected. Also, experts once again revised the risks of a recession.

Today, the pressure on the position of the trading instrument is exerted by publications from China: industrial production in November slowed down from 5% to 2.2%, retail sales fell by 5.9% after falling by 0.5% in October, although analysts expected negative dynamics of –3.6%.

According to the latest report from the US Commodity Futures Trading Commission (CFTC), last week, the number of net speculative positions in silver amounted to 19.2K against 17.5K a week earlier, and the "bears" regained their leadership in positions from swap dealers, although the gap remains minimal: 39.437K against 38.329K for the "bull" s. This week, sellers increased the number of contracts by 2,416K, while buyers lost 1,436K deals.

On the daily chart, Bollinger Bands are rising steadily: the price range is narrowing, reflecting the emergence of ambiguous trading dynamics in the short term. The MACD indicator is falling, forming a new sell signal (the histogram is trying to consolidate below the signal line). Stochastic reversed downwards at "80", signaling in favor of the development of a corrective decline in the ultra-short term.

Resistance levels: 23.32, 23.60, 24.00, 24.42. | Support levels: 23.00, 22.70, 22.40, 22.19.

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