Home Forex XAG/USD falls amid US consumer sentiment and high US yields

XAG/USD falls amid US consumer sentiment and high US yields

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  • Silver is holding at $22.50, resistant to losses and finding strong support at this key level.
  • A rise in US consumer sentiment is pushing up US Treasury yields, which is impacting the dynamics of XAG/USD.
  • Mixed economic signals: Wall Street gains, but US existing home sales hit 13-year low; better inflation outlook.

silver for the third time in a week, price is extending its losses and facing solid support at around familiar levels, with sellers unable to decisively push prices below $22.50. Improving sentiment among US consumers fueled a jump in US Treasury yields. At the time of writing, XAG/USD is trading at $22.50, down 0.99%.

XAG/USD holds at $22.50 despite surge in Treasury yields

Wall Street is trading solidly in the green as US Treasury yields rise. In spite of, American dollar The index (DXY), which measures the value of the dollar against a basket of six currencies, was virtually unchanged at 103.41.

On the data front, US existing home sales fell to a 13-year low, falling -1% month-on-month to 3.78 million from 3.82 million in previous months and forecasts. At the same time, US households became more optimistic about the economic and inflation outlook, the University of Michigan (UoM) revealed: UoM consumer sentiment rose to 78.8 in its preliminary reading for January, beating forecasts and rising to 69.7 last month. In addition, Americans expect inflation to ease from 3.1% to 2.9% 12 months from today and to cool from 2.9% to 2.8% five years from now.

On the data, the 10-year U.S. Treasury yield soared toward 4.196% before settling to around 4.163%, a headwind for precious metals that typically benefit from lower yields.

Meanwhile in Chicago Fed President Austan Goolsbee said they need more data before cutting rates determine the degree of restriction.

Earlier in the day, San Francisco Fed President Mary Daly is expected to cross the wires ahead of the blackout period that precedes the first Monetary Policy meeting in 2024.

XAG/USD Price Analysis: Technical Outlook

Technically, silver has consolidated above/below the $22.50 area, which should reveal another level of support at the November 13 low of $21.88 after a definitive break to the downside. Further losses are seen once it is broken by another swing to $20.69, the October 3 low. On the downside, if buyers lift XAG/USD above $23.00, it will reveal key resistance levels at $23.17, the 100-day moving average (DMA), followed by the 200 and 50-DMA, each at $23.54 and 23 .66 USD, or

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