- Rising US T-bond yields underpin greenback weight on the precious metals complex.
- Tensions in Ukraine and Russia keep markets searching for USD safe haven status.
- XAG/USD Technical Outlook: Bearish biased unless it breaks above the 200-DMA at $24.61.
Silver slips for the third straight trading session, trading at $23.81 during the New York session at the time of writing. Market sentiment has been unchanged since the start of the week. The Ukraine-Russia conflict continues to grab the headlines as market participants await the Federal Reserve’s monetary policy decision.
The white metal — a safe-haven precious metal like gold — has failed to gain value despite geopolitical woes blamed in part on US T-bond yields, recouping some of Monday’s losses as it crossed the 1, 70% broke at 1.747% at press time, underpinning the greenback. The US Dollar Index, a measure of the dollar’s value against a basket of its rivals, is up 0.28% to 96.118 at 14:19 GMT.
Analysts at TD Securities said an interest rate hike was already signaled by Fed policymakers, led by Jerome Powell, at the March FOMC meeting. A start signal from the January meeting should not surprise anyone. Still, the issue that is unsettling investors is quantitative tightening (QT), or balance sheet shrinking.
The US economic index included the Housing Price Index (HPI), which came in at 1.1%, as expected. At 15:00 GMT, the Conference Board is due to release December Consumer Confidence, which is expected to come in at 111.4.
XAG/USD Price Prediction: Technical Outlook
On Tuesday, the white metal is trading towards the end of Monday which traded at $23.98. two cents from the $24.00 threshold. The price action of the last two days approached the 78.6% Fibonacci retracement drawn from the last pivot low at $22.81 to the yearly high of $24.70. However, the white metal is bearish unless XAG/USD breaks the 200-day moving average (DMA) at $24.61.
On the upside, the first resistance is the 38.2% Fibonacci retracement level at $23.98, which was broken once unsuccessfully. The next supply zone would be the daily high of Jan. 24 at $24.31, followed by the aforementioned 200-DMA at $24.61.
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