Silver Price Analysis: XAG/USD dives to $24.22 on Fed Powell’s comments

• Silver dives from $24,85 to $24.20 after Powell's speech.
• Fed Powell confirms QE tapering and demand for metals plunge.
• XAG/USD remains bullish, with the $24,85 resistance area on focus.

Silver futures have pulled back from levels right below two-month highs, at $24.87, retreating to the $24.20 area on the back of the US dollar’s bullish reaction to Fed Powel’s comments.

Metal prices die as Powell confirms QE tapering

Precious metals have turned lower on Friday, to give away previous gains, following Federal Reserve Chairman Powell’s comments in a virtual appearance. Powell has confirmed the bank’s plan to start rolling back bonds purchases but he has played down the idea of accelerating interest rate hikes.

The market reaction has favored the dollar’s recovery, with the USD Index appreciating 0.2% after bouncing up from session lows at 93.50 to 93.75 highs, while Stock markets and precious metals have turned lower.

XAG/USD: remains positive, with $24.85 resistance on focus

Technical indicators remain fairly positive on a broader view, with silver futures likely to retest early September highs at $24.80. If that level gives way, the pair might take a break before aiming towards $25.20 (August 3, 4 lows) and April’s top, at $26.00.

On the downside, immediate support lies at 24.10 (October 21 low) and below here, trendline support from late-September lows, now around $23.40, maintain the positive trend. Below here, bears might gain momentum and pull the pair to $23.00 (October 18 low) and 22.20/35 (October 6 and 12 lows).

Technical levels to watch