Strong silver gains reach their highest peak in two years
Weakness in the US dollar contributes to silver rising above $26
Silver surges on Fed signal to hault interest rate hikes
The US dollar weakened significantly following the Federal Reserve's interest rate statement
Silver succeeds in rising to peaks unseen in the last two years.
Significant increases for silver after a 25 basis point hike
Silver has been experiencing a series of price hikes since the beginning of the week, following the trend set by gold. The US dollar's weakness, particularly after the Federal Reserve hinted that it may halt interest rate hikes soon in its latest interest rate statement, has been a contributing factor.
At its third meeting this year, the Federal Reserve's monetary policy committee decided to increase the US interest rate by 25 basis points for the third consecutive month, bringing the final interest rate to 5.25%. The Federal Reserve mentioned in its statement that it may stop increasing interest rates in upcoming meetings, considering the cumulative monetary tightening policy and its impact on economic activity.
The decision to halt interest rate hikes has not been finalized, and will be made at each meeting separately, without predetermined decisions or targets. Future interest rate decisions will depend on economic data.
Despite the increase in available jobs and low unemployment rate, Federal Reserve Governor Jerome Powell emphasized that the Federal Reserve is still very concerned about the persistently high inflation risks. Silver opened the last trading session of the week with a slight increase, hovering around the $26 level. The markets are anticipating the release of several significant economic data from the United States, including the US employment data.
The key levels that may affect silver movements
Silver prices were able to break strong resistance levels of $26.00 but has yet to surpass and hold prices above this level. The $26.00 to $26.40 level represents a price resistance area that silver has not reached in two years. If it succeeds in surpassing this level and holding prices above it, this may contribute to further upward movement to the $27.50 level, and surpassing it is likely to extend to the $28.70 resistance level.
If silver fails to surpass the mentioned resistance levels, it is likely to face some correction to test the $24.50 support level, which is important to maintain to demonstrate the intention to climb. If silver breaks the $24.50 support level and holds prices below it, it is likely that the decline will extend further to levels of $23.50 - $21.70.