Silver sits heavy on daily support
- Silver is in the hands of the bears as they attack daily support.
- Precious metals are under pressure on a firm US dollar.
XAG/USD is currently trading at $24.7745, heavy as it fails in its hourly correction having fallen from a high of $25.2770 to a low of $24.7100, down some 1.96% on the day so far.
The white metal has struggled to benefit from rising inflation expectations with the greenback firming as the week gets going.
DXY, representing the greenback vs a basket of currencies, is proving to be robust at a critical support area following a period of neglect despite a bullish US yield environment.
Meanwhile, on the whole, precious metals have enjoyed strong Chinese and Indian demand, along with renewed interest from central banks in the case of gold for which silver tends to track.
''As the world is starting its exit from the covid-19 crisis, the breadth of central banks purchasing gold could potentially rise substantially considering the massive increase in sovereign debt and the rapid pace of money supply growth in reserve currency countries,'' analysts at TD Securities have argued.
''A sustained rise in official interest could provide further support for the yellow metal during this period of lacklustre investment flows, particularly until the rise in rates peters out,'' the analysts argued.
Silver technical analysis
Meanwhile, the bears are in control having just broken a critical daily support layer:
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Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
