Silver Price Analysis: XAG/USD remains below 50-period SMA on H4, FOMC awaited

• Silver edges higher during the Asian session, though the downside remains cushioned.
• Traders now seem reluctant to place aggressive bets ahead of the key FOMC decision.
• The mixed technical setup further warrants some caution before placing directional bets.

Silver struggles to capitalize on the previous day's goodish rebound from the $24.30-$24.25 area, or a one-and-half-week low and trades with a mild negative bias through the Asian session on Wednesday. The white metal, however, lacks follow-through selling and currently trades around the $24.65 region, down less than 0.15% for the day.

From a technical perspective, the recent break and acceptance below the 50-period Simple Moving Average (SMA) favours bearish traders and suggests that the path of least resistance for the XAG/USD is to the downside. That said, oscillators on hourly/daily charts are holding in the positive territory and warrant some caution before positioning for any further depreciating move. Traders also seem reluctant from placing aggressive directional bets and prefer to wait for the highly-anticipated FOMC monetary policy decision, due later this Wednesday.

In the meanwhile, the 50-period SMA on the 4-hour chart, currently pegged around the $24.85 region, is likely to act as an immediate hurdle ahead of the $25.00 psychological mark. Any subsequent move up, however, is more likely to remain capped near last week's swing high, around the $25.25 region. The latter should act as a pivotal point, above which the XAG/USD could surpass the $25.50-$25.55 intermediate hurdle and climb further towards reclaiming the $26.00 round figure en route to the YTD peak, around the $26.10-$26.15 area touched in May,

On the flip side, the weekly low, around the $24.30 area, is likely to protect the immediate downside, below which the XAG/USD could slide to the $24.00 mark. Some follow-through selling should pave the way for deeper losses towards the $23.65-$23.60 support before the XAG/USD drops to the $23.20-$23.15 region. Some follow-through selling below the $23.00 mark, nearing the very important 200-day SMA, will shift the bias in favour of bearish traders and make the XAG/USD vulnerable to challenge the multi-month low, around the $22.15-$22.10 area.

Silver 4-hour chart

Key levels to watch