- Silver fell early in the session on Friday amid a technical selling episode.
- The metal fell from $ 27.00 to $ 26.00 in a matter of minutes and has been unable to recoup losses.
- NFP’s soft numbers did little to affect price action, with markets much more focused on optimism and reflation.
Silver Spot Prices (XAG / USD) They tumbled shortly after the cash open of European equities on Friday, dropping nearly $ 1 from below $ 27 to $ 26 before aggressively bouncing back to $ 26.50. In recent trading, the selling pressure has resumed and the precious metal is back below $ 26 and is pressing new lows of $ 25.80. On the day, the XAG / USD was down more than 4.5% or nearly $ 1.20.
Technical selling appears to have been the main factor behind Friday’s selloff, with XAG / USD breaking below a medium-term uptrend that had been in play since early December.
The fundamentals are also weighing; The dollar index, with which precious metals like silver are negatively correlated, briefly topped 90.00 in the early part of the European session on Friday (although, to be fair, the DXY is heading towards 89.50 and is now down). Meanwhile, US real yields (with which precious metals also have a negative correlation) also continue to rise; The 10-year TIPS yield is trying to move above -1.0% for the second time this week and a move towards the November highs above -0.8% could see precious metals like silver move substantially lower. down from current levels.
Technical selling weighs on XAG / USD
The XAG / USD broke below the key uptrend support that joined the lows of November 29, December 11, 14, 15 and 23 and January 6 during the Friday session, a move that coincided with a break by under $ 27.00. The metal found support at $ 26.00, which coincides with the lows of December 29. Currently, the precious metal is trading closer to $ 26.50, but has struggled to rally above resistance in the form of Wednesday’s low of $ 26.60. If the precious metal moves towards the low of the day and $ 26.00, a test of its 21-day moving average at $ 25.77 could be in the cards.
4 hour chart
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
