Silver (XAG/USD) experienced significant downward pressure on Thursday, sliding below the key $60 psychological level as sellers maintained control over the market [1]. At the time of reporting, XAG/USD was trading around $58.83, marking a 1.87% decline for the day and hovering near two-month lows [1]. This decline occurred despite a slight easing in the US Dollar and US Treasury yields, with the benchmark 10-year yield retreating toward 5.30% after hitting 5.36% on Wednesday, its highest point since 2002 [1]. Elevated yields, driven by persistent inflation risks and expectations of further Federal Reserve rate hikes, have increased the opportunity cost of holding non-yielding assets like silver, contributing to the bearish sentiment [1].
Technical analysis indicates a continued bearish outlook for silver, as XAG/USD remains below the 50-day, 100-day, and 200-day Simple Moving Averages (SMAs) [1]. Momentum indicators reinforce this negative tone, with the Relative Strength Index (RSI) drifting toward the mid-30s and the Moving Average Convergence Divergence (MACD) staying below zero with a negative line, both suggesting persistent downside pressure [1]. Resistance is noted at the $60 level and the clustered band of the 100-day and 50-day SMAs around $64.11-64.23, while firm support lies at $55.00, with a potential move toward $50.00 if this support is breached [1].
The market implication is that as long as silver trades below $60.00, sellers are likely to dominate, and rallies may be limited rather than leading to a sustained recovery [1]. The technical setup and macroeconomic backdrop, including high US yields and inflation concerns, continue to weigh on silver prices [1].
CONCLUSION
Silver's drop below $60 reflects ongoing bearish sentiment driven by high US yields and inflation expectations. Technical indicators and resistance levels suggest further downside risk unless the price can reclaim key levels. The market remains cautious, with sellers expected to retain control in the near term.