In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the XAGUSD for SEP 18, 2024. 

Key Takeaways 

• Fed rate cut: The Fed will announce the latest interest rate decision and dot plot on Thursday. The market generally expects the Fed to cut interest rates at this week’s policy meeting, but the extent of the cut is still uncertain. Since the decline of the US dollar is basically calculated by a 25 basis point rate cut, if the Fed cuts interest rates by 25 basis points as scheduled, the US dollar may rise instead of falling, but whether it can continue to rise requires attention to Powell’s speech and the dot plot in the economic forecast. 

• Silver’s rise: The market expects that the Fed is increasingly likely to cut interest rates by 50 basis points this week. As the best tool to hedge inflation, gold has become the asset class that benefits the most. However, based on the continuous rise of gold before, the return rate of gold may be weaker than that of silver. As a precious metal with a high correlation with gold, silver is more worthy of investors’ attention from the perspective of profit and loss ratio and catch-up rise. 

Technical Analysis 

Daily Chart Insights 

(XAGUSD Daily Price Chart, Source: Ultima Markets MT4) 

• MACD: The indicator sends a bullish signal again above the 0 axis, suggesting that the current bullish trend is a continuation of the previous trend. There is still no sign of slowing down in the enlargement of the kinetic energy column, and the short-term bullish thinking is the main focus. 

• Resistance price: Silver prices are at the upper edge of the rising channel, and the market price has a probability of slowing down in the short term. In line with the Fed’s interest rate cut timing, if the interest rate is cut by 50 basis points, the silver price is expected to break through the channel line at that time, and the target is near the red long-short conversion area. If the interest rate is cut by 25 basis points, the silver price is still expected to rise, but it may be more volatile before that. 

H1 Chart Insights 

(XAGUSD H1 Price Chart, Source: Ultima Markets MT4) 

• Stochastic oscillator: The indicator fluctuates and hovers below the 50 median line, making it clear that the short-term intraday silver price will be mainly volatile and falling. After waiting for the indicator to fall into the oversold area, pay attention to the long trading signal 

• Downward flag shape: The MA group opens and expands after sending out long signals alternately, suggesting the strength of the current long trend. At present, the silver price has fallen to the black 65-period MA, and a falling flag shape is formed at the same time. This is usually a relay pattern, and it will continue to rise after the oscillation pattern is completed. 

Pivot Indicator 

(XAGUSD M30 Price Chart, Source: Ultima Markets APP) 

• According to the Ultima Markets APP, the central price of the day is established at 31.00, 

• Bullish Scenario: Bullish sentiment prevails above 31.00, first target 31.40, second target 31.75; 

• Bearish Outlook: In a bearish scenario below 31.00, first target 30.48, second target 30.15. 

Conclusion 

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Disclaimer   

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