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August 24th - This week, bond investors will be closely watching Federal Reserve Chairman Warshs speech in Jackson Hole. The market is seeking his response to persistent inflation and fiscal issues, and long-term Treasury bonds may face further sell-off risks. Warsh has rarely provided forward-looking policy guidance since taking office in May. His speech following the last monetary policy meeting triggered a massive sell-off in the bond market, highlighting the markets high sensitivity to his speech on Friday. Molly Brooks, U.S. interest rate strategist at TD Securities, said, "I think if he continues to not provide more information, the market will be disappointed, which could further exacerbate the recent sell-off in long-term Treasury bonds." Kathy Bostjancic, chief economist at National Mutual Insurance, said that factors continuing to weigh on the bond market remain, including fiscal concerns, inflation, and market uncertainty about the Feds response. Dhiraj Narula, interest rate strategist at HSBC, said this provides Warsh with an opportunity to reassure investors by clarifying his policy outlook. He said, "In our view, if Chairman Warsh can make some judgments about potential inflationary pressures, it could be enough to reduce the term premium associated with uncertainty."On August 24th, the UKs Office for Maritime Trade Operations (UKMTO) reported that commercial shipping traffic in the Strait of Hormuz continued to decline over the past 48 hours, with shipping activity suppressed and the number of vessels passing through in both directions in single digits. The UKMTO report stated that no confirmed attacks or interference incidents were detected, but noted that Iranian threats and harassment activities persist, including drone overflights, targeted surveillance of merchant ships, and occasional VHF radio calls. These actions "continue to demonstrate Irans intention to maintain a presence along key shipping lanes and to continue to exert pressure on transit vessels." Meanwhile, the UKMTO stated that commercial traffic in the Red Sea and the Bab el-Mandeb Strait has also "continued to decline" following the Houthi blockade of Saudi Arabia on July 20th.The UK Maritime Trade Operations Office (UKMTO) stated that shipping traffic in both the Strait of Hormuz and the Bab el-Mandeb Strait has declined.On August 24, Canadian Ambassador to the United States Mark Wiseman stated that trade negotiations between Canada and the US broke down on the evening of August 22 due to multiple issues, including discrepancies between the written text of a potential agreement and what Canada believed to be the consensus reached between the two sides. In an interview on August 23, Wiseman said that no single issue led to the failure of the negotiations. The breakdown in negotiations subsequently triggered a new round of tariffs and could further escalate the Canada-US trade dispute.Iraqi Prime Ministers Security Advisor: We have proposed to Iran and Saudi Arabia the establishment of a unified security coordination committee.

Silver Price Analysis: Bulls maintain control of the XAGUSD and could target the $22.50 supply zone

Alina Haynes

Nov 11, 2022 17:35

 截屏2022-11-08 下午5.37.02_1024x576.png

 

On Friday, silver extends its breakout momentum through the extremely significant 200-day simple moving average for a second consecutive session. During the early European session, the white metal reaches a five-month high, but struggles to achieve acceptance beyond the $22.00 round-figure threshold. However, the XAGUSD maintains its intraday gains and is currently trading in the $21.85-$21.90 range, up about 0.90% for the day.

 

The overnight rise from levels below $21.00 and subsequent strength above a technically key moving average bolster the likelihood of a near-term advance. However, the RSI (14) on the daily chart is close to entering overbought territory and aggressive bullish traders should proceed with caution. Before positioning for further gains, it is recommended to wait for some near-term consolidation or a slight drop.

 

Nevertheless, the XAGUSD is prepared to surpass $22.00 and may seek to test the next significant barrier near $22.45-$22.50. The aforementioned region represents a dense supply zone and may prove difficult for bulls to penetrate. However, some follow-through purchasing will signal a new breakout and pave the way for a move toward recovering the $23.00 round number. The momentum might eventually propel spot prices to a May swing high in the vicinity of $23.25 to $23.30.

 

In contrast, the daily low around $21.45 that coincides with the 200 DMA breakout point should protect the downside in the short term. Any more decline could be viewed as a buying opportunity and should be limited near $21.00. A decisive breach below might spark technical selling and bring the XAGUSD below the $20.40 support zone. Failure to defend the previously mentioned support levels could shift the near-term bias toward bearish traders.

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