Silver Price Analysis: XAG/USD retreats on rising US yields


  • The XAG/USD dropped more than 1% on Thursday below the $25.00 mark.
  • US Jobless Claims in the second week of July came in lower than expected.
  • Rising US Treasury yields weight on the precious metals.

The XAG/USD Silver spot price dropped towards the $24.80 area, recording a 1.28% loss on Thursday amid a recovery of the USD. Despite weak Manufacturing and Housing data, lower-than-expected Jobless Claims fueled a rise in hawkish bets on the Federal Reserve (Fed)  and  US Treasury yields, making the grey metal lose interest.

Investors assess US data ahead of next week's Fed’s decision

The US reported mid-tier data. On the negative side, the Philadelphia Federal Reserve Manufacturing survey showed worrying results as its index declined more than expected, coming in at -13 vs the consensus of -10. In addition, following Wednesday’s soft Housing data, Existing sales from the US from June also showed weakness. The figure showed a contraction of 3.3% MoM in June with a 4.16M decrease.

However, investors seem to be weighing more Jobless Claims data. For the week ending on July 14, the number of people filing for unemployment benefits came in lower than the market consensus at 228,000 vs 242,000 expected and below the previous figure of 237,000. It fueled a rise in US Treasury yields on Federal Reserve hawkish bets. The 2-year yield rose to 4.88% while the 5 and 10-year rates jumped to 4.10% and 3.84%, with all three displaying strong increases of more than 1.50%. As bond yields could be seen as the opportunity cost of holding non-yielding metals, Silver prices are retreating.

XAG/USD Levels to watch

According to the daily chart, the technical outlook for the XAG/USD is neutral to bearish for the short term as bulls run out of steam. The Relative Strength Index (RSI) got rejected at the overbought threshold, while the Moving Average Convergence Divergence (MACD) prints lower green bars, indicating a lower buying pressure. However, on the bigger picture, the outlook is bullish as the price trades above the 20, 100 and 200-day Simple Moving Averages (SMA).

Support levels: $24.70, $24.50, $24.10.

Resistance levels: $25.00, $25.30,$25.00.

XAG/USD Daily chart

XAG/USD

Overview
Today last price 24.8
Today Daily Change -0.34
Today Daily Change % -1.35
Today daily open 25.14
 
Trends
Daily SMA20 23.42
Daily SMA50 23.56
Daily SMA100 23.65
Daily SMA200 22.85
 
Levels
Previous Daily High 25.24
Previous Daily Low 24.94
Previous Weekly High 25.02
Previous Weekly Low 22.75
Previous Monthly High 24.53
Previous Monthly Low 22.11
Daily Fibonacci 38.2% 25.13
Daily Fibonacci 61.8% 25.06
Daily Pivot Point S1 24.98
Daily Pivot Point S2 24.81
Daily Pivot Point S3 24.68
Daily Pivot Point R1 25.27
Daily Pivot Point R2 25.4
Daily Pivot Point R3 25.57

 

 

 

 

 

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