Silver Price Analysis: XAG/USD slips despite weakening USD, falling US bond yields
- Silver price slides from a daily high of nearly $26.00, down nearly 1%.
- Disinflationary trends in the US economy persist, but core readings hold at 5.5% YoY.
- XAG/USD technical outlook suggests the potential for further decline, testing key support levels.
Silver price slides after hitting a daily high of $25.91, following the release of US inflation figures continued to show that the economy is in a disinflationary process. Nevertheless, core readings are clinging to the 5.5% YoY barrier, which could warrant further tightening by the Fed. The XAG/USD is trading at around $25.30s, surprisingly down almost 1%, even though the US T-bond yields and the US Dollar (USD) remained down.
XAG/USD Price Analysis: Technical outlook
The XAG/USD daily chart suggests that sellers are gathering momentum, even though the uptrend remains intact. The Relative Strength Index (RSI) indicator flashes the previously mentioned, with the RSI edging towards its neutral level, while the 3-day Rate of Change (RoC) registers volatility in negative readings.
If XAG/USD continued to trend lower would test the 20-day Exponential Moving Average (EMA) at $25.17. In a decisive break, XAG/USD sellers will target the $25.00 figure, followed by the confluence of the 15-day upslope trendline and the February 2 high, turning support at around $24.60/70. A breach of the latter, XAG would slide toward the confluence of a five-month-old previous resistance trendline now support and the 50-day EMA at 24.29/40.
Conversely, the XAG/USD could resume its uptrend once buyers step in and reclaim the May 9 daily low of $25.33. In that outcome, the first resistance would be the May 9 high of $25.67, followed by the $26.00 figure.
XAG/USD Price Action – Daily Chart
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
