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Silver Price Analysis: Investors Seek Safety Amid Risk Averse Sentiment

  • Silver prices above $23.00.
  • Mixed US economic data and rising US Treasury yields could not dent demand for silver.
  • XAG/USD Price Analysis: To test $24.00, once buyers recapture $23.52.

The price of the silver rose sharply late in the New York session, 0.34%, due to the general weakness of the US dollar (USD), amid a risk aversion boost in financial markets. Investors seeking safety shifted funds into the precious metals segment. At the time of writing, the XAG/USD pair is trading at $23.30, after hitting a low of $22.83.

XAG/USD Supported by Sentiment and a Weaker US Dollar

Wall Street has shifted gears as Tuesday’s close approaches. Although sentiment changed after First Citizens BancShares acquired Silicon Valley Bank (SVB), traders expect another rate hike from the US Federal Reserve (Fed) in the summer. Reflecting this are US Treasury yields, which are rising, with 2-year yields above the 4% threshold.

In terms of data, the US economic calendar included March Consumer Confidence, which rose to 104.2 from 103.4 in February. “Built by a rebound in expectations, consumer confidence improved somewhat in March but remains below the median level seen in 2022,” said Ataman Ozyildirim, senior director of economics at the Conference Board.

Before the Wall Street open, the House Price Index rose 0.2% month-on-month in January, versus an estimated 0.6% drop, data from the US Federal Housing Finance Agency showed on Tuesday. At the same time, the S&P/Case-Shiller home price index stood at 2.5% year-on-year in January, up from 4.6% the previous month.

Meanwhile, the Dollar Index, which tracks the value of the dollar against six currencies, extended its losses for two straight days, falling to three-day lows at 102.407, down 0.42%.

XAG/USD Technical Analysis

XAG/USD Daily chart

The daily chart for Silver suggests that the XAG/USD has a neutral to bullish bias, with the 20 day EMA crossing above the 50 day EMA. In bullish territory, the Relative Strength Index (RSI) has resumed its bullish trajectory, while the Rate of Change (RoC) is neutral. That being said, the mixed signals warrant caution. For XAG/USD to test all-time highs, the white metal needs to recapture $23.52. Once that is done, XAG/USD could rally towards $24.00 before testing the recent years high at $24.63.

XAG/USD

Overview
Last price today 23.32
Today Change Daily 0.24
today’s daily variation 1.04
today’s daily opening 23.08
Trends
daily SMA20 21.64
daily SMA50 22.22
daily SMA100 22.5
Daily SMA200 20.98
levels
previous daily high 23.28
previous daily low 22.85
Previous Weekly High 23.52
previous weekly low 22.16
Previous Monthly High 24.64
Previous monthly minimum 20.42
Fibonacci daily 38.2 23.01
Fibonacci 61.8% daily 23.12
Daily Pivot Point S1 22.86
Daily Pivot Point S2 22.64
Daily Pivot Point S3 22.43
Daily Pivot Point R1 23.29
Daily Pivot Point R2 23.5
Daily Pivot Point R3 23.72

Source: Fx Street

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