Silver Price Tumbles on Bearish Chart Pattern and Hawkish Sentiment
The price of Silver has dropped significantly after breaking through a key support level and forming a bearish head-and-shoulders chart pattern. The XAG/USD price fell by over 5.3% to $63.72, with the metal's price erasing its gains from Wednesday. This decline was exacerbated by the metal's break below the $64.00-$64.15 support trendline.
The hot US PPI report has driven up US bond yields and underpinned the US Dollar, increasing the chances of a rate hike by the Fed next week. However, a softer CPI reading on Friday could leave the meeting 'live', while higher prices would cement a hawkish case.
Technically speaking, XAG/USD cleared the head-and-shoulders neckline, but a daily close below this level is required to confirm the bearish chart pattern. If this occurs, the next support levels for Silver would be $60.00 and then the head-and-shoulders target near $55.00.