Silver Price Plummets 5% Amid Rising Yields and Stronger Dollar
The price of Silver has taken a hit, plummeting 5% as momentum indicators turn bearish. The US 10-year Treasury yield has risen to 5.27%, its highest level since 2007, making it more expensive for investors to hold Silver.
A firmer US Dollar Index (DXY) near 101.25 also makes the metal more costly for overseas buyers. Markets are pricing in a 70% chance of another rate hike in October, according to CME FedWatch, after the central bank raised rates by 25 basis points at its September 15-16 meeting.
XAG/USD is under pressure from a dense cap of moving averages, with the 50-day Simple Moving Average (SMA) at $63.88 acting as overhead resistance. The Relative Strength Index (RSI) at 39 leans toward bearish momentum and the Moving Average Convergence Divergence (MACD) stays negative.
On the topside, initial resistance emerges at the 50.0% Fibonacci retracement at $62.95, followed by the 50-day SMA at $63.88 and higher barriers before the $71.12 anchor and the 200-day SMA at $73.19.