- The XAG/USD pair found support at a daily low of $22.20, and then rallied towards $22.55, trading flat.
- US retail sales exceeded expectations.
- Despite strong data, USD consolidates and caps losses for Silver.
On Tuesday, the XAG/USD he liquidated the daily gains and his losses were capped as the USD consolidated the previous day’s gains. Attention now turns to the Minutes of the July meeting of the Federal Open Market Committee (FOMC).
US retail sales showed that the US economy is holding up. Sales rose 0.7%m/m, above 0.4% expected, while excluding autos were also strong, coming in at 1% versus 0.4% expected.
As for the next meeting of the Federal Reserve (Fed), the prevailing expectation is that there will be no hike in September. However, the odds of a 25 basis point adjustment in November top out at around 40%. That said, attention now turns to Wednesday’s Federal Open Market Committee (FOMC) meeting as investors look to future guidance for clues to get a different perspective on where officials stand.
Against this backdrop, US bond yields, considered the opportunity cost of owning silver, are declining. The 10-year bond yield is trading at 4.18%, which is a loss of 0.62% on the day. The 2-year yield stands at 4.95%, with a loss of 0.81%, and the 5-year yield stands at 4.33%, with a loss of 0.62%.
XAG/USD Levels to Watch
Technical analysis on the daily chart suggests a neutral to bearish stance for XAG/USD as bears strive to rally and exert their influence. The Relative Strength Index (RSI) is in negative territory and suggests a possible equilibrium in the market with balanced buying and selling pressure. At the same time, the moving average convergence (MACD) shows flat red bars. Furthermore, the pair is below the 20,100 and 200-day SMAs, highlighting the continued dominance of bears on a broader scale, forcing buyers to take action.
Support levels: $22.15, $22.00, $21.80.
Resistance levels: $23.30 (200-day SMA), $23.50, $24.00.
XAG/USD Daily Chart
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
