Silver Price Forecast: XAG/USD retreats from $23.00 down to $22.30s amid an uptick of US bond yields
|- XAG/USD slides for the fourth consecutive day, down 1.67% as Fed’s Chair Powell testifies on the Congress.
- The market sentiment is upbeat, dampening the risk appetite of safe-haven assets like silver.
- XAG/USD: A break below $22.00 would expose the YTD low at $21.33.
Silver (XAG/USD) continues falling for the fourth day In a row, down trading at $22.40 at the time of writing. in the overnight session, the white metal peaked at $23.01. However, it retreated the move as risk appetite improved, as investors dumped safe-haven assets, turning towards riskier ones, as portrayed by US equity indices rising between 0.48% and 0.50%. Contrarily safe-have currencies like the JPY and the USD are the main gainers in the FX market, with risk-sensitive currencies dropping except for the NZD, advancing 0.10%.
That said, the XAG/USD silver bottomed around $22.30, reached a seven-week fresh low amid an uptick in US 10-year T-bond yields, rising one basis point, sitting at 1.46%. Amid those plays, the US Dollar Index, which measures the greenback’s value against a basket of its peers, is barely flat, at 95.98, as investors start to price in a Fed’s faster bond taper, that could move forward the possibility of hiking rates, sooner than expected.
In the meantime, one of the catalysts of gold, US Real Yields, as of November 30, rose by 1.66%.
Fed’s Chair Powell commented that inflation is no longer “transitory,” expects it will moderate in 2022
Summarizing some of Powell’s remarks, he said that “[Fed] don’t see wages moving up at a troubling rate that would spark inflation.”. He reiterated that it is time to move from the word transitory from inflation and expects that the abovementioned will moderate in 2022, despite not being sure of the forecast. Powell added that “It is appropriate we consider speeding taper at next meeting to wrap it up earlier.”
XAG/USD Price Forecast: Technical outlook
The XAGU/USD daily chart depicts the non-yielding metal has a downward bias. The daily moving averages (DMA’s) with a flat slope but above the spot price confirmed the abovementioned. In the outcome of continuing trending lower, the first support would be the $22.00 figure. A break of the latter would expose the September 30 low at 21.33
On the flip side, the first resistance would be December 1 high at $23.00. A break above that level could pave the way for further gains. The following resistance would be the 50-DMA at $23.52, and then the 100-DMA at $23.80, as the price would close towards $24.00.
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