- The XAG/USD pair fell to its lowest level since mid-July near the $23.10 zone, below the 100-day SMA.
- The dollar gained ground on higher US yields after Friday’s losses.
- All eyes are now on July CPI data due to be released in the US on Thursday.
On Monday, the price of Silver XAG/USD it fell near the 100-day SMA, near the $23.20 zone, with losses of more than 1.80%. Rising US Yields and the strengthening USD after Friday’s sell-off are the main culprits for the metal’s decline.
As attention turns to the next set of US inflation data, markets continue to digest Friday’s Non-Farm Payrolls (NFP) report. Job creation cooled and wages rose, but investors dumping the dollar during Friday’s session indicated that investors were more weighting the decline in the number of people employed. Even so, the Federal Reserve (Fed) will consider the increase in wage inflation in its next meetings. For the rest of the week, the highlight is the release of inflation data on Thursday, with the headline Consumer Price Index (CPI) accelerating to 3.3% yoy and the core CPI falling to 47% in the same month.
In response, US bond yields are falling. The 10-year bond yield stands at 4.08%, up 1.04% on the day. The 2-year yield remains neutral at 4.77%, and the 5-year yield stands at 4.16%, up 0.61%.
As for the Fed’s next decisions, according to the CME’s FedWatch tool, markets are pricing in higher odds for a September pause, with odds down to 20% of 25 basis points (bps). Those odds rise to 30% in November, where the strongest case is also for the Fed not to raise.
XAG/USD levels to watch
On the daily chart, XAG/USD shows a short-term bearish outlook. Both the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) remain in negative territory, with the RSI below its midline and sloping south. The MACD is also showing red bars, indicating strengthening bearish momentum. Furthermore, the pair is sitting below the 20,100 and 200-day SMAs, which points to prevailing bear strength in the broader context as buyers face a challenging situation.
Support levels: $23.00, $22.90, $22.70.
Resistance levels: $23.20 (200-day SMA), $23.50, $23.70.
XAG/USD Daily Chart
-638270221822990783.png)
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.
