Silver Holds Ground as US Dollar and Treasury Yields Retreat

Silver (XAG/USD) is holding steady on Tuesday, benefiting from a weaker US Dollar and lower Treasury yields. At the time of writing, the metal is trading around $61.50, up 0.75% for the day. Despite this intraday recovery, Silver remains within a narrow range, constrained by both fundamental challenges and technical resistance.

The US Treasury yields, although slightly lower on Tuesday, remain near multi-year highs. This elevated yield environment increases the opportunity cost of holding non-yielding assets like Silver. Inflation risks persist, keeping the Federal Reserve inclined toward further tightening, though recent softer US economic data have reduced expectations of a rate hike at the October 27-28 meeting. Traders now anticipate one more rate hike this year, likely in December, with attention turning to the upcoming Federal Open Market Committee (FOMC) meeting minutes for further guidance.

Technically, Silver is confined between $60 and $62 on the daily chart, trading below key daily Simple Moving Averages (SMAs). The Relative Strength Index (RSI) at 43 indicates neutral-to-soft territory, while the negative Moving Average Convergence Divergence (MACD) suggests that rallies are likely to face selling pressure. Initial resistance is seen near $62, with further levels at $63.84, $64.20, and $64.45. On the downside, support stands at $60.00, with a sustained break below potentially exposing the cycle low near $56.57.