- Silver price can find some support near the $21.00 mark on Tuesday.
- The upbeat US data lifted the USD broadly and weigh on the XAG/USD.
- The first resistance level is seen at $21.68; $20.65 acts as an initial support level.
Silver price (XAG/USD) recovers some lost ground around $21.00 during the early European session on Tuesday. However, the upside of the silver price seems to be limited. The firmer US Dollar (USD) and higher US Treasury yields are the main factors that exert some selling pressure on XAG/USD.
Meanwhile, the US Dollar Index (DXY), a measure of the value of the USD relative to a basket of foreign currencies, climbs to 107.20, the highest level since November last year. The US Treasury yields also edge higher on Tuesday, with the US 10-Y yield staying at 4.69%, the highest level since 2007.
On Monday, the US ISM Manufacturing PMI came in at 49.0 in September from 47.6 in the previous reading, above the market consensus of 47.7. This figure showed that business activity in the US manufacturing sector continued to contract. The upbeat US data lifted the USD across to board and exert some selling pressure on the precious metal.
Traders will focus on the US JOLTS Job Openings for August due on Tuesday. Later this week, the US ISM Services PMI and ADP report will be released on Wednesday. The highlight of the week will be the US Nonfarm Payrolls on Friday. These events could give a clear direction to the silver price.
Silver price (XAG/USD) technical outlook
From the technical perspective, silver price holds below the 50- and 100-hour Exponential Moving Averages (EMAs) with a downward slope on the one-hour chart, which means the path of the least resistance is to the downside. Additionally, the Relative Strength Index (RSI) is located in the bearish territory below 50, supporting the sellers for the time being.
Resistance level: $21.68 (the upper boundary of the Bollinger Band, 50-hour EMA), $22.10 (100-hour EMA), and $22.83 (a high of September 28)
Support level: $20.65 (the lower limit of the Bollinger Band), $20.00 (a low of March 7), and $19.63 (a high of October 28, 2022)
XAG/USD one-hour chart
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