Quotes and rates for precious metals Silver vs US Dollar (XAGUSD)

• Silver maintains modest gains supported by a still-bullish market sentiment despite high US Treasury yields.
• Technical outlook favorable as the Relative Strength Index (RSI) indicates buying activity despite a slight dip.
• Potential resistance and breakout points set at $28.75 and $29.00, with eyes on surpassing the year-to-date high of $29.79.

Silver clings to modest gains of 0.29% and stays above $28.00 for the sixth consecutive trading day amid higher US Treasury bond yields and a strong US Dollar. At the time of writing, the XAG/USD trades at $28.30 after hitting a daily low of $28.14.

XAG/USD Price Analysis: Technical outlook

The grey metal continues to hold to the $28.00 threshold, while the Relative Strength Index (RSI) continues to edge lower. One could assume that buyers are taking a respite as the RSI edges lower, but it remains above the latest through of 54.00. With that said, Silver remains upward-biased as momentum favors bulls.

If XAG/USD buyers reclaim the May 18, 2021, daily high at $28.75, they could challenge $29.00. A breach of the latter will expose the year-to-date (YTD) high at $29.79 before challenging $30.00.

Otherwise, Silver’s drop below $28.00 would give sellers the upper hand and expose key support levels. Firstly, the April 15 daily low at $27.59, followed by the confluence of the 50% Fibo retracement and the $27.00 figure.

XAG/USD Price Action – Daily Chart

• Silver price extends its upside around $28.50 in Thursday’s early European session. 
• Rising industrial demand and ongoing tensions in the Middle East benefit the white metal. 
• The higher chance that the Fed will delay its easing cycle might cap the upside of the silver price.

Silver price (XAG/USD) gains momentum near $28.50 on Thursday during the early European session. The upsurge of the white metal is bolstered by rising industrial demand and safe-haven flows amid the ongoing geopolitical tensions in the Middle East. 

The Silver Institute released its annual World Silver Survey on Wednesday, showing that industrial demand in the silver market is expected to hit another record high this year, climbing 9% to 710.9 million ounces. The rising demand is driven by silver demand for Photovoltaic (PV) solar panels. Furthermore, the ongoing tensions in the Middle East, particularly between Iran and Israel, might further fuel the demand for silver. ANZ commodity analysts said that silver still has significant potential, even after hitting solid resistance at $29.90 last week.

On the other hand, the growing speculation that the Federal Reserve (Fed) will delay its easing cycle might cap the upside of silver price. Fed Cleveland President Loretta Mester said on Wednesday that inflation is higher than anticipated and the Fed needs more confidence in its trajectory. Earlier this week, Fed Chair Jerome Powell emphasized that he will wait for more evidence to gain confidence that inflation is headed toward the central bank’s 2% goal before lowering borrowing costs. It’s worth noting that the higher-for-longer US rate narrative might dampen demand for white metal, a non-interest-bearing asset. 

• Silver edges higher, showing resilience with a 0.50% gain, yet faces tough resistance near $28.74.
• Technical analysis suggests potential pullback risks with $28.00 as a pivotal level; further support at $27.59 and $27.00.
• Upside momentum could resume if prices surpass $28.28, targeting higher resistance points at $28.74 and potentially $29.00.

Silver’s prices remain in positive territory but continued to register higher tails in the daily chart, signaling buyers' failure to commit to higher prices above the May 18, 2021, high of $28.74. At the time of writing, XAG/USD trades at $28.21 and gains 0.50%.

XAG/USD Price Analysis: Technical outlook

The daily chart depicts the grey metal as upward biased even though it’s retreating below the crucial resistance level, exposing the significant $28.00 figure. Once that level is cleared, it could potentially lead to a significant shift in the market dynamics. Silver’s next support would be the April 15 low of $27.59 ahead of $27.00. Once that level is taken out, the next demand zone would be the December 4, 2023, high turned support at $25.91.

On the other hand, if buyers lift XAG/USD prices back above June 10, 2021, high at $28.28, it could clear the path to test $28.74. A breach of the latter will expose $29.00, followed by the year-to-date (YTD) high at $29.79.

XAG/USD Price Action – Daily Chart

• Silver price jumps higher to $28.60, driven by worsening geopolitical tensions.
• Israel’s response to Iran’s attack will escalate fears of Middle East tensions spreading beyond Gaza.
• US bond yields edge down despite Fed lean towards higher interest rates for a longer period.

Silver price (XAG/USD) advances to $28.60 in Wednesday’s early New York session. The white metal witnesses significant buying interest as deepening Middle East tensions keep safe-haven bid firm. Investors are worried that tensions in the Middle East region could spread beyond Gaza as Israel said it will respond to Iran’s attack on their territory.

The Iranian military launched hundreds of missiles and drones on Saturday in retaliation to Israel’s attack on the Iranian embassy near Damascus in Syria in which two high-rank generals were killed. After Iran’s attack on Israel Tehran said, “the matter deemed to be closed.” However, should the Israeli regime make another mistake, Iran’s response will be considerably more severe, Wall Street Journal reported. The appeal for bullions strengthens when investors see geopolitical tensions escalating further.

Meanwhile, 10-year US Treasury yields fall to 4.63% despite Federal Reserve (Fed) sees interest rates remaining higher for a longer period. A decline in yields on interest-bearing assets eases the opportunity cost of holding an investment in non-yielding assets, such as Silver.

The US Dollar Index (DXY) exhibits strength near 106.20 as robust US Retail Sales data for March has improved the economic outlook. Higher spendings by households are done when labor market conditions remain tight, suggest strong economic outlook.

Silver technical analysis

Silver price faces selling pressure while attempting to break above horizontal resistance plotted from 3 August 2020 high at $29.86. The long-term outlook of the white metal is bullish as the 20-week Exponential Moving Average (EMA) at $24.85 is sloping higher.

The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, suggesting a strong upside momentum.

Silver weekly chart

• Silver price appreciates as traders adopt caution on expectations of Israel responding to Iran's attack.
• The decline in the US Dollar provides support to advance Silver demand.
• The price of the white metal could struggle as the Fed may adopt a hawkish stance on its monetary tightening.

Silver price edges higher to near $28.50 per troy ounce during the European trading hours on Wednesday. The safe-haven bullion like Silver gains ground on the market caution. Investors are cautiously monitoring Israel's response to Iran's air strike on Saturday.

A Reuters article reported that the rescheduling of the third meeting of Israel's war cabinet, initially slated for Tuesday, has been moved to Wednesday. The purpose of this meeting is to discuss and deliberate on Israel's response to Iran's unprecedented direct attack.

Additionally, the mild downward correction in the US Dollar adds to the upside of the Silver demand. However, the US Dollar Index (DXY) maintains a position near its five-month high of 106.51 reached on Tuesday. 2-year and 10-year US yields on US Treasury bonds stand at 4.96% and 4.65%, respectively, by the press time.

The expectations of the Federal Reserve (Fed) maintaining elevated interest rates for a longer duration, buoyed by a robust US economy and persistent inflation. Additionally, the hawkish remarks from the Federal Reserve Chair Jerome Powell, could support the US Dollar (USD). A stronger US Dollar (USD) tends to make silver more expensive to buy for investors using other currencies, which could impact the demand for the white metal.

On Tuesday, Federal Reserve Chair Powell remarked that recent data suggests minimal advancement in inflation this year, implying a prolonged period before reaching the 2% target. This statement potentially fostered a more hawkish sentiment and lent support to the US Dollar, according to Reuters.

• Silver retreats to $28.09, unable to hold above the crucial $29 mark, indicating potential further declines.
• The 'dark cloud cover' technical pattern suggests vulnerability and possible downward movement.
• Focus remains on silver's ability to sustain above the $28.00 threshold, with key support and resistance levels closely watched.

Silver prices retreat from daily highs reached $29.01, dropping 2.63%, affected by high US Treasury yields, and stirring resistance around the $29.00 threshold. The XAG/USD trades at $28.09, breaking key support levels on its way toward current spot prices.

XAG/USD Price Analysis: Technical outlook

From a technical standpoint, XAG/USD buyers failed to hold Siver’s quote above the psychological $29.00 level after reaching a year-to-date (YTD) high of $29.79. That exacerbated the grey’s metal drop toward the $28.00 mark, opening the door for further downside. During the last couple of days, price action formed a ‘dark cloud cover’ that needs confirmation below the April 15 low of $27.59.

Momentum was extremely bullish, though the Relative Strength Index (RSI) exited from overbought conditions during the day, sponsoring a leg-down on Silver. That said, XAG/USD could witness a pullback before buyers attempt to challenge the $29.00 mark.

Given the backdrop, Siver’s first support would be $27.59, followed by the $27.00 mark. Further losses are seen at $26.29, the April 5 low. On the flip side, if buyers keep the XAG/USD spot price above $28.00, the next resistance levels are seen at the June 10, 2021, high at $28.28, followed by the May 18, 2021 high at $28.74.

XAG/USD Price Action – Daily Chart

• Silver price plunges to $28.40 as the US Dollar capitalizes on uncertainty over Fed rate cut timing.
• US bond yields rise further as the Fed is expected to consider rate cuts later this year.
• Geopolitical tensions keep safe-haven demand intact.

Silver price (XAG/USD) slumps to $28.40 in Tuesday’s European session. The white metal faces intense selling pressure as the US Dollar extends its upside to more than five-month high around 106.40. The US Dollar strengthens after robust United States Retail Sales data for March deepened uncertainty about when the Federal Reserve (Fed) will start reducing interest rates.

S&P 500 futures have posted some losses in the European session, portraying a decline in the risk appetite of the market participants. 10-year US Treasury yields hover near a fresh five-month high around 4.63%. US bond yields extend their upside on expectations that the Fed will delay rate cuts later this year. The US Dollar Index (DXY) rises to 106.33 and continues its winning streak for the fifth trading session on Tuesday.

Fed policymakers see no urgency for a reduction in interest rates. San Francisco Fed Bank President Mary Daly emphasized keeping the monetary policy restrictive until policymakers get convinced that inflation is on course towards the 2% target.

The near-term outlook of Silver remains strong amid fears that tensions in the Middle East region could spread beyond Gaza. After a cabinet meeting on Monday with Israel Prime Minister Benjamin Netanyahu, Israel’s military Chief of Staff Herzi Halev said they would respond to Iran’s attack on their territory. On Saturday, Iran launched hundreds of drones and missiles to retaliate against Israel’s attack on the Iranian embassy in Syria near Damascus, in which two high-ranked generals died.

Silver technical analysis

Silver price faces selling pressure while attempting to break above horizontal resistance plotted from 3 August 2020 high at $29.86. The long-term outlook of the white metal is bullish as the 20-week Exponential Moving Average (EMA) at $24.85 is sloping higher.

The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, suggesting a strong upside momentum.

Silver weekly chart

• XAG/USD climbs 3.61%, nearing $29.00 due to robust demand in the precious metals sector.
• Technical analysis suggests further upside potential, with aims at the April 12 high of $29.79 and the key $30.00 level.
• Key supports are at the May 18, 2021, high of $28.75, the June 10, 2021, high of $28.28, and the crucial $28.00 psychological level.

Silver's price rose past $28.00, extending its gains close to the $29.00 threshold, which was briefly pierced last Friday, but buyers failed to hold the price above that level. At the time of writing, XAG/USD trades at $28.85, up by 3.61%.

XAG/USD Price Analysis: Technical outlook

Silver’s daily chart portrays the grey metal is bullish, shy of reclaiming the $29.00 handle. Once cleared, the next resistance would be the April 12 high of $29.79 before aiming toward the $30.00 threshold, last seen in February 2013. The next resistance would be February’s monthly high at $32.15.

Conversely, XAG/USD’s first support would be the May 18, 2021, high turned support at $28.75, followed by the June 10, 2021, high at $28.28. Once those two levels are surpassed, the $28.00 psychological level will be next.

XAG/USD Price Action – Daily Chart

• Silver price bounces back to $28.50 even though investors expect Middle East tensions won’t escalate further.
• US bond yields rally amid uncertainty over Fed rate cut timing.
• Upbeat US Retail Sales boost demand for the US Dollar.

Silver price (XAG/USD) finds strong buying interest near $27.50 after correcting from fresh highs of $29.80. The white metal rebounds to $28.50 in Monday’s American session but struggles to extend recovery as investors expect that Middle East tensions will not escalate further.

Iran said we don’t want to raise tensions in the Middle East further. Their administration added, “the matter deemed to be closed.” However, should the Israeli regime make another mistake, Iran’s response will be considerably more severe, the Wall Street Journal reported. Meanwhile, US President Joe Biden said it won’t support the counterattack from Israel. On Saturday, Iran launched hundreds of drones and missile on the Israeli state.

Meanwhile, higher bond yields due to deepening uncertainty about when the Federal Reserve (Fed) will pivot to rate cuts is barricading the Silver price from further upside. 10-year US Treasury yields rise to 4.65%.

The US Dollar Index (DXY) extends its upside to 106.20 after upbeat US Retail Sales data for March. The US Census Bureau reported that Retail Sales rose strongly by 0.7% from expectations of 0.3% but the pace was slower than the prior reading of 0.9%, upwardly revised from 0.6%.

Silver technical analysis

Silver price recaptures a three-year high near $30.00. The long-term outlook of the Silver price is extremely bullish as the 20-week Exponential Moving Average (EMA) near $25.00, is sloping higher. The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, suggesting that a bullish momentum is active.

Silver weekly chart

• Silver regains positive traction and reverses a part of Friday’s retracement slide from the YTD peak.
• The RSI on the daily chart is flashing overbought conditions and warrants caution for bullish traders.
• Any meaningful slide might continue to attract fresh buyers and is more likely to remain cushioned.

Silver (XAG/USD) catches fresh bids on the first day of a new week and stalls its retracement slide from the vicinity of the $29.80 region, or the highest level since February 2021 touched on Friday. The white metal sticks to intraday gains through the early part of the European session and is currently placed just below mid-$28.00s.

From a technical perspective, the recent breakout through the $25.60-$25.70 horizontal resistance and the subsequent move up was seen as a fresh trigger for bullish traders. That said, the Relative Strength Index (RSI) is flashing overbought conditions on the daily chart and makes it prudent to wait for some near-term consolidation or a modest pullback before positioning for any further appreciating move.

Meanwhile, any corrective decline below the $28.00 round figure is likely to find decent support near the $27.80-$27.75 region, below which the XAG/USD could accelerate the fall towards the $27.25 area en route to the $27.00 mark. Some follow-through selling might expose the next relevant support near the $26.35-$26.30 region before the white metal drops to the $26.00 mark and the $25.70-$25.60 resistance breakpoint.

On the flip side, sustained strength back above the $28.50 level should allow the XAG/USD to reclaim the $29.00 mark. The momentum could extend further towards the $29.80 zone, or the YTD peak, above which bulls are likely to aim back towards conquering the $30.00 psychological mark.

Silver daily chart

• Silver pulls back sharply from its highest point since February 2021, suggesting the rally might be overextended.
• If it breaks below key supports at $28.28 and $28.00, further declines to $27.54 and $27.00 could occur.
• A recovery above $28.00 could reignite bullish sentiment, aiming for previous highs and resistances.

Silver's price tumbled on Friday’s session after refreshing three-year highs reached in February 2021. The grey metal peaked at $29.79 before plunging close to $2.00. The XAG/USD traded at $27.84, down 2.01%.

 XAG/USD Price Analysis: Technical outlook

Silver is bullishly biased despite retreating sharply after spiking toward the $29.70s area. However, achieving a daily close below the June 10, 2021, high turned support at $28.28 and clearing below $28.00 has opened the door for a pullback. Therefore, XAG/USD's first support would be the April 10, low at $27.54, ahead of challenging the $27.00 figure. Further losses are seen on May 5, 2023, with high turned support at $26.12.

On the other hand, strong bullish momentum remains, and if buyers reclaim $28.00, that could be put back into the table, the continuation of the rally. The first supply zone would be June 10, 2021, high at $28.28, before testing May 18, 2021, at $28.74. Once surpassed, the next stop would be the year-to-date (YTD) high at $29.79.

XAG/USD Price Action – Daily Chart

• Silver price rallies to $29, boosted by safe-haven demand due to geopolitical tensions.
• A decline in US yields has reinforced demand for non-yielding assets.
• The US Dollar advances as speculation for Fed rate cuts wanes.

Silver price (XAG/USD) looks set for a positive weekly close for the third time in a row. The precious metal strengthens as geopolitical tensions and China’s weak economic outlook strengthen safe-haven demand.

Iran promised to retaliate against Israel’s air strike on their embassy near Damascus in which seven members of its Islamic Revolutionary Guard Corps (IRGC), including two generals, were killed. The war situation in Gaza between Israel and Palestine could further escalate after the direct intervention of Iran. Meanwhile, the Israeli administration vowed to invade Rafah where displaced Palestinians have been sheltered. Investors channel their funds into non-yielding assets, such as Silver, amid geopolitical uncertainty.

Meanwhile, a sharp decline in US Treasury yields has reduced the opportunity cost of investment in non-yielding assets. 10-year US Treasury yields retreat to 4.55% from a more than four-month high of 4.60%. The US Dollar Index (DXY) is an inch away from recapturing a five-month high at 106.00.

The US Dollar strengthens as stubbornly higher consumer price inflation and strong Nonfarm Payrolls (NFP) data for March have forced traders to unwind their bets leaned toward the Federal Reserve (Fed) to begin reducing interest rates in the June and July policy meetings. Now, investors see the Fed pivoting to rate cuts from September. Also, investors expect that the Fed will reduce interest rates only two times by the year-end instead of three projected by Fed policymakers in the latest dot plot.

Silver technical analysis

Silver price approaches an 11-month high near $30, plotted from 27 July 2020 high on a weekly timeframe. The long-term outlook is bullish as the 20-week Exponential Moving Average (EMA) at $24.56 is sloping higher. The 14-period Relative Strength Index (RSI) rises to 73.00, suggesting strong buying momentum. More upside remains favored amid the absence of divergence signals.

Silver weekly chart

• Silver surges, bolstered by easing US producer prices, sparking interest in precious metals.
• Though overbought, strong bullish momentum could target the next resistance at $28.74.
• Support established at $28.00 and $27.54, key during potential pullbacks.

Silver price surges on Thursday after the release of prices paid by producers in the United States (US) showed that factory inflation continues to decelerate, contrasting Wednesday’s red-hot Consumer Price Index (CPI). Investors capitalized on that, as they took advantage of the dip in precious metals and lifted their prices near year-to-date peaks.

The XAG/USD trades at $28.45 and clocks minimal gains of 0.09% after ending Thursday’s session up by 1.94%.

XAG/USD Price Analysis: Technical outlook

The grey metal rally is set to extend after rallying after June 10, 2021, at a high of $28.28, which has opened the door for further upside. Silver gains momentum, although momentum oscillators suggest it's overbought. The Relative Strength Index (RSI), at 77.41, is still shy of reaching the 80 levels sought by traders as the overbought condition in a strong bullish trend.

With that said Silver’s next resistance would be the May 18 high at $28.74, followed by the psychological $29.00 figure. On the other hand, if sellers drag prices below the June 10, 2021, high, turned support, that will pave the way for further losses. The first support would be $28.00, followed by the April 10 low of $27.54, ahead of $27.00.  

XAG/USD Price Action – Daily Chart

• Siver price loses momentum near $27.85 on the stronger USD on Thursday.
• Precious metals traders do not seem too concerned about U.S. inflation reports that came in higher than expected.
• Rising industrial demand and escalating geopolitical tensions in the Middle East boost the silver price. 

Siver price (XAG/USD) trades with mild losses around $27.85 after retracing from the fresh three-year high of $28.53 during the early European session on Thursday. The lower speculation that the Federal Reserve (Fed) will cut the interest rate in June drags the gray metal lower. Investors await the US March Producer Price Index (PPI) on Thursday for fresh impetus. 

Traders slashed bets on Fed interest rate cuts on Wednesday after US inflation was hotter than expectations and US President Joe Biden acknowledged that there was more work to be done to combat rising prices. The US Consumer Price Index (CPI) report in March suggested that the path of easing inflation remains extremely bumpy and the US central bank is likely to maintain the higher-for-longer rate narrative. This might limit the upside of silver as the gray metal becomes less attractive compared to interest-bearing assets. Fed Funds Futures market pushed expectations for the first rate cut from June to September, according to the CME FedWatch Tool.

On the other hand, rising industrial demand and its attraction to an alternative inflation hedge might cap the downside of silver prices. Additionally, the ongoing geopolitical tensions in the Middle East and its attraction to an alternative inflation hedge might lift silver prices in the near term as Israel and Hamas rejected ceasefire talks and Iran vowed retaliation for an airstrike on its embassy in Syria.

• Silver price plummets to $27.85 as speculation for Fed pivoting to rate cuts erode.
• Hot US inflation data dent Fed rate cut prospects for June.
• Uncertainty over Fed’s three rate cut projections by the year-end deepens.

Siver price (XAG/USD) retreats from fresh two-year high of $28.36 after the United States Bureau of Labor Statistics (BLS) reported that the consumer price inflation turns out sticky. Hot inflation figures combined with strong payroll data for March have dented market expectations for the Federal Reserve (Fed) to begin lowering interest rates from the June meeting.

The annual headline Consumer Price Index (CPI) accelerated to 3.5% from expectations of 3.4% and the prior reading of 3.2%. Annual core inflation that excludes volatile food and energy prices rose steadily by 3.8%. Economists expected the most sought-after inflation measure to decelerate to 3.7%.

Fed policymakers have been reiterating that it is not appropriate to reduce interest rates until they get convinced that inflation will return sustainably to the 2% target. For inflation to return to 2%, the monthly inflation should increase at a pace of 0.17%. In March, both headline and core CPI rose steadily by 0.4% against expectations of 0.3%.

Going forward, traders are expected to shift their bets for the Fed beginning to reduce interest rates in the third quarter this year. Stubbornly higher inflation is expected to deepen uncertainty over three rate cut projections for this year as anticipated by Fed policymakers in the latest dot plot.

Hot CPI figures have led to a sharp increase in yields on interest-bearing assets, such as US bonds. 10-year US Treasury yields have risen to 4.48%. The US Dollar Index (DXY) rallies to the crucial resistance of 105.00.

Silver technical analysis

Silver price delivers a stalwart rally after a breakout of the Ascending Triangle chart pattern formed on a daily timeframe. The strength of the breakout will be tested if the white metal corrects to the horizontal resistance of the above-mentioned chart pattern plotted from 14 April 2023 high at $26.09. Upward-sloping 20-day Exponential Moving Average (EMA) at $26.00 suggests that the near-term demand remains upbeat.

The 14-period Relative Strength Index (RSI) drops after reaching 76.00, indicating that oscillators are cooling after turning extremely overbought.

Silver daily chart

• Silver price gains ground on expectations of Fed rate cuts in 2024.
• The non-yield asset like Silver appreciates as US Treasury yields decline.
• Israel's Foreign Affairs Minister, Israel Katz, affirmed that Israel would retaliate if Iran attacks its territory.

Silver price exhibits a sideways trend with positive sentiment to extend its gains for the fourth successive session, hovering around $28.10 per troy ounce during the early European session on Wednesday.

Silver price could appreciate further on expectations of rate cuts from the Federal Reserve (Fed) this year. The decline in US Treasury yields leads to supporting non-yielding assets like Silver, with 2-year and 10-year yields on US Treasury bonds standing at 4.74% and 4.36%, respectively, at the current press time.

Furthermore, the price of Silver follows the upward movement in Gold prices, supported by increased consumer and industrial demand. China's addition of 160,000 troy ounces of gold to its reserves in March, along with gold purchases by Turkey, India, Kazakhstan, and several Eastern European countries this year, further contributes to the positive sentiment surrounding precious metals.

The escalating geopolitical tensions in the Middle East are driving investors towards safe-haven assets like Silver. Israel's Foreign Affairs Minister, Israel Katz, issued a warning that Israel would retaliate if Iran attacks its territory. Additionally, peace talks between Israel and Hamas in Egypt have failed to make progress.

Investors adopt a cautious stance, anticipating potential policy shifts influenced by incoming data. Strong labor market figures from last week could prompt a more hawkish stance from the Federal Reserve if inflation exceeds expectations. This could potentially limit the upward momentum of Silver price.

• Silver reaches $28.32, lifted by falling US Treasury yields, softer Dollar, despite Fed's hawkish view.
• Israel's PM comments add to geopolitical tensions, boosting precious metals.
• Market eyes US CPI for inflation insights; Fed vows to tackle inflation.

Silver rallied to an almost three-year high, with the grey metal breaching key resistance on June 10, 2021. Buyers are eyeing May 2021 highs. Factors like a soft US Dollar and falling US Treasury yields underpin the precious metal amid speculations of a less dovish Federal Reserve.  The XAG/USD trades at $28.00 a troy ounce after hitting a new multi-month high of $28.32.

XAG/USD breaks past $28.00 as declining US Treasury yields and geopolitical uncertainties fuel demand for safe-haven assets

The sudden reversal in US Treasury yields has driven the rally in precious metals. After gaining 15 basis points in the last two trading days, the US 10-year benchmark note drops to 4.37%, losing five bps. That and a softer Greenback sponsored Silver’s last leg up above the $28.00 threshold.

Geopolitical risks weigh on the buck and underpin precious metals. Israel Prime Minister Benjamin Netanyahu revealed they will complete the elimination of Hamas brigades, including in Rafah, and nothing will prevent this, according to Reuters. In the meantime, Israel's ceasefire proposal was rejected by Hamas.

Market participants are looking for the release of the latest inflation report in the United States (US). The Consumer Price Index (CPI) is expected to ease from a monthly perspective, yet it’s foreseen to be higher than February’s data in yearly figures. Core CPI is projected to dip in both readings.

Federal Reserve’s policymakers had crossed the wires. The latest to cross newswires was Minnesota Fed Neil Kashkari, who said the US central bank can’t fall short on the inflation fight.

XAG/USD Price Analysis: Technical outlook

The daily chart suggests that XAG/USD might continue to rally past the $28.00 figure, though the Relative Strength Index (RSI), turning overbought, spurred a pullback. That could be seen as traders booking profits.

If the retracement continues, Silver’s next support would be $27.50, ahead of testing the April 8 low of $26.87. On the other hand, a resumption of the uptrend would pave the way to test $28.32, ahead of climbing toward $29.00.

• Silver price follows the rally in gold as global central banks increase their reserves.
• The price of Silver has advanced to its highest level since June 2021.
• The eased geopolitical situation in the Middle East could have limited the advance of Silver price.

Silver price advances for the third consecutive session, trading higher to near $28.00 per ounce during the early European hours on Tuesday. This surge in Silver price mirrors the rally in gold, driven by heightened consumer and industrial demand. Global central banks increasing their reserves in gold have also contributed to the increased appetite for precious metals.

Furthermore, the demand for non-yielding assets like silver is bolstered as US Treasury yields correct after two days of gains. At present, the 2-year and 10-year yields on US Treasury bonds stand at 4.78% and 4.39%, respectively.

Traders eagerly await the release of the US Consumer Price Index data scheduled for Wednesday. It is anticipated that the US headline CPI will accelerate in March, while the core measure is expected to show a cooling down. The industrial outlook for metals received a boost from strong manufacturing data from top consumer China and projections for increased solar installations.

However, Silver price could have faced downward pressure as geopolitical tensions have eased in the Middle East, following the withdrawal of most Israel Defense Forces from southern Gaza, possibly due to growing international pressure, has contributed to easing tensions. Additionally, peace talks between Israel and Hamas have resumed in Egypt

Traders will now shift their focus to the upcoming US inflation data and the release of FOMC minutes this week to gain more clarity on the timing of the Fed's monetary policy adjustments.

• Silver's rise mirrors growing precious metals interest, fueled by global central bank moves.
• Overbought RSI hints at consolidation before aiming higher, reflecting market optimism.
• Upcoming targets: $28.00 resistance, June 2021 peak, signaling potential for more gains.

Silver’s price rose for the second straight day, climbing to $27.80, gaining more than 1% in late trading on Monday’s North American session, even though US Treasury bond yields advanced. Even though speculations that the US Federal Reserve could cut twice instead of three times were no excuse for the grey’s metal advance linked to Gold’s rally. Appetite for precious metals increased as global central banks increased their reserves in Gold.

XAG/USD Price Analysis: Technical outlook

The rally in the precious metals is set to continue, with the grey’s metal set to extend its gains past the $28.00 figure. Although the Relative Strength Index (RSI) suggests that Silver is overbought, it could consolidate at around the $27.00-$28.00 range, before achieving its next leg up.

Stir resistance lies at $28.00, followed by the June 10 , 2021 peak at around $28.28. Further upside is seen at $29.00.

XAG/USD Price Action – Daily Chart