- Silver price rebounds as DXY eases but not out of the woods yet.
- XAG/USD faces stiff resistance at the bearish 50-DMA barrier.
- Bears eye a firm break below rising trendline support at $22.43.
Silver price (XAG/USD) is catching a breather above $22.50 after a five-day non-stop downward spiral.
A minor pullback in the US dollar across the board, as the Asian stocks and US equity futures regain footing ahead of PCE inflation data this Friday. The US dollar index eases from 18-month highs of 97.29 to now trade at 97.19, down 0.07% on the day.
The greenback garnered strength this week, mainly in response to the hawkish Fed outlook, stronger US Q4 advance GDP and the Russia-Ukraine geopolitical risks.
Markets are taking profits off the table on their dollar longs ahead of the critical US PCE inflation release, helping silver price find a floor.
However, a bottom in silver price appears distant, as bears are likely to remain in the game amid a bearish technical setup on the daily chart.
After the downside break from three-week-old ascending trendline support at $23.66 on Wednesday, selling pressure intensified and knocked down silver price sharply through all the major Daily Moving Averages (DMA).
XAG bulls, however, managed to find support just ahead of the six-week-long rising trendline support, now aligned at $22.43.
Silver Price Chart: Daily chart
If buyers fail to find a strong foothold above the bearish 50-DMA at $22.91, then sellers are likely to return, putting the daily trendline support at risk once again.
Daily closing below the latter will trigger a sharp sell-off towards the January 7 lows of $21.95, below which the $21.50 psychological level will be on the sellers’ radars.
The 14-day Relative Strength Index (RSI) is attempting a bounce but remains well below the midline, suggesting that the downside risks remain intact.
Silver Additional levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds below 1.0750 ahead of key US data
EUR/USD trades in a tight range below 1.0750 in the European session on Friday. The US Dollar struggles to gather strength ahead of key PCE Price Index data, the Fed's preferred gauge of inflation, and helps the pair hold its ground.
GBP/USD consolidates above 1.2500, eyes on US PCE data
GBP/USD fluctuates at around 1.2500 in the European session on Friday following the three-day rebound. The PCE inflation data for March will be watched closely by market participants later in the day.
Gold clings to modest daily gains at around $2,350
Gold stays in positive territory at around $2,350 after closing in positive territory on Thursday. The benchmark 10-year US Treasury bond yield edges lower ahead of US PCE Price Index data, allowing XAU/USD to stretch higher.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
US core PCE inflation set to signal firm price pressures as markets delay Federal Reserve rate cut bets
The core PCE Price Index, which excludes volatile food and energy prices, is seen as the more influential measure of inflation in terms of Fed positioning. The index is forecast to rise 0.3% on a monthly basis in March, matching February’s increase.