Silver price is under pressure after the July FOMC meeting minutes showed that the US central bank is preparing to taper its asset purchases later in the year. However, the policymakers stipulated that the tapering should not be viewed as a sign of imminent interest rate hikes. With reference to raising rates, the committee members held the opinion that employment is yet to make the substantial progress required by the Fed.
As a reaction to the minutes, the dollar index surged to its highest level since November 2020 at 93.50. While it has since pulled back to its current level of 93.39, the surge is weighing on XAGUSD.
Silver price technical outlook
Silver price is holding steady above the crucial level of $23 even as it remains on a downtrend. Earlier on Thursday, the precious metal dropped to a one-week low of 23.10. At the time of writing, it was down by 0.67% at 23.34. The psychological level of 23 has been a key support level for the metal. This is especially after rebounding from its lowest level year-to-date earlier in the month.
On a two-hour chart, it is trading slightly below the 25 and 50-day exponential moving averages. In the immediate term, I expect silver price to trade within a tight range of between 23.00 and along the 50-day EMA at 23.61. Entry of more buyers into the market may push the price to the psychological level of 24. It is likely to then pull back along the 50-day EMA.