The price of silver has experienced a significant decline due to concerns about the Federal Reserve implementing higher interest rates.

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• Silver price drops sharply amid fears of more interest rates from the Fed.

The pair currently trades last at 23.047.

The previous day high was 23.65 while the previous day low was 23.04. The daily 38.2% Fib levels comes at 23.27, expected to provide resistance. Similarly, the daily 61.8% fib level is at 23.42, expected to provide resistance.

Silver price (XAG/USD) drops to near $23.00 in the early New York session. The white metal faces a sell-off as the US Dollar resumes its upside journey after a mild correction to near 105.90. The appeal for the US Dollar improved as Federal Reserve (Fed) policymakers delivered a hawkish commentary on the interest rate outlook.

The S&P500 opens on a bearish note as investors remain worried about government shutdown risks. The US Dollar Index remains in the grip of bulls as the global economy is on the cusp of a slowdown. European economies are struggling to bear the consequences of higher interest rates by the European Central Bank (ECB) while the Chinese economy is facing deflation risks.

On the contrary, the US economy has absorbed the pitfalls of higher interest rates by the Fed efficiently, making the US Dollar resilient in comparison with other G7 economies.

Meanwhile, US New Home Sales demand dropped to 675K vs. expectations of 700K and the former release of 714K. The demand for new homes dropped due to higher borrowing costs. The US Conference Board reported Consumer Confidence Index declined to 103.00 from 108.7 in August as households worry about the Fed’s ‘higher for longer’ interest rates plot.

Silver price faces selling pressure near the 50% Fibonacci retracement (plotted from August 30 high at $25.00 to September 14 low at $22.30) at $23.66 on a two-hour scale. The white metal drops below the 50-period Exponential Moving Average (EMA) at $23.25 indicating that the short-term trend has turned bearish.

The Relative Strength Index (RSI) (14) skids into the bearish range of 20.00-40.00, which indicates that a bearish impulse has been activated now.

Technical Levels: Supports and Resistances

XAGUSD currently trading at 23.0 at the time of writing. Pair opened at 23.13 and is trading with a change of -0.56 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 23.45, 50 SMA 23.63, 100 SMA @ 23.6 and 200 SMA @ 23.47.

The previous day high was 23.65 while the previous day low was 23.04. The daily 38.2% Fib levels comes at 23.27, expected to provide resistance. Similarly, the daily 61.8% fib level is at 23.42, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 22.9, 22.67, 22.29
• Pivot resistance is noted at 23.51, 23.88, 24.12

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