Silver Price Forecast: XAG/USD rally up to $23.00 as XAG bulls get ready to challenge the 100-DMA

The non-yielding metal advanced despite the US 10-year Treasury yield clung above the 1.90% threshold.
US inflation expectations grind lower as shown by FRED data, eased to 2.4%.
XAG/USD is neutral biased, but XAG bulls get ready for a test to the 100-DMA.

Christian Borjon Valencia FXStreet

Silver (XAG/USD) begins the week on higher note rallies more than 2% on Monday. As the Asian Pacific session begins, XAG/ÛSD is trading at $23.01. Financial market sentiment is mixed. The Dow Jones Industrial finished with gains, while the S&P 500 and the Nasdaq closed with losses.

Despite the rise of US T-bond yields, Silver rallied. The 10-year benchmark note dropped one basis point though clung to 1.919%, while US Real Yields, as of February 4, finished at -1.00% but failed to weigh on the non-yielding metal.

In the meantime, as reported by St. Louis Federal Reserve (FRED) data, US Inflation expectations eased to 2.4%.

An absent US economic docket keeps XAG/USD traders assessing the January Nonfarm Payrolls report unveiled last Friday. The figures crushed expectations by large, 467K vs. 150K estimated. However, Fed worries regarding inflation made investors look towards Average Hourly Earnings, which shoot to 5.7%, 0.7% higher than December’s reading. That said, it further cements the US central bank hawkish expectations, as money market futures have prices in five rate hikes.

That said, silver traders’ focus would be on Thursday’s US inflation numbers for January. Estimations by analysts expect the Consumer Price Index (CPI) at 7.3%, while the Core CPI, which excludes food and energy, at 5.9%, both readings on an annual basis.

XAG/USD Price Forecast: Technical outlook

On Monday, XAG/USD broke above the 50-day moving average (DMA), but it faced strong resistance at the $23.00 figure. Nevertheless, the rally broke four resistance levels on its way up, as XAG bulls get ready for a challenge of the 100-DMA at $23.19.

Silver is neutral biased. However, a breach of the 100-DMA could send the non-yielding metal upwards. The first resistance would be January 3 high at $23.40, followed by a tenth-month-old downslope trendline, around the $24.00-$24.20 range.

XAG/USD

Overview
Today last price	23.02
Today Daily Change	0.51
Today Daily Change %	2.27
Today daily open	22.51

Trends
Daily SMA20	23.15
Daily SMA50	22.8
Daily SMA100	23.18
Daily SMA200	24.46

Levels
Previous Daily High	22.67
Previous Daily Low	22.12
Previous Weekly High	23.05
Previous Weekly Low	22.01
Previous Monthly High	24.7
Previous Monthly Low	21.96
Daily Fibonacci 38.2%	22.46
Daily Fibonacci 61.8%	22.33
Daily Pivot Point S1	22.19
Daily Pivot Point S2	21.88
Daily Pivot Point S3	21.64
Daily Pivot Point R1	22.75
Daily Pivot Point R2	22.99
Daily Pivot Point R3	23.3

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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