The precious metal has returned to losing against the greenback after rallying yesterday and could drop below the $23 level if the losses increase.
XAG Back To Being Bearish
Silver has been underperforming since the start of the week. The precious metal was trading towards the $22 level for most of the week. However, it rallied higher yesterday and finally broke past the $23 mark.
The rally was fueled by a weakened dollar, which has also underperformed against the other major currencies this week. Despite the XAG rallying against the greenback yesterday, it couldn’t maintain the momentum.
XAG is down by 0.85% over the past 24 hours and is now trading at $23.317. By failing to surpass the $24 level, Silver has exposed itself to dropping below the $23 mark over the coming hours. The decline comes as the greenback recovered some of its losses earlier today.
The US Treasury yield has improved over the past few hours, leading the US Dollar to recover some of its losses. The US stock futures also performing excellently led to a stronger greenback. With the US Dollar regaining some of its lost position, XAG had to retrace.
XAG Could Drop Below $23
Silver is looking like it would shed some of its gains over the coming hours. If the current market momentum is maintained, then XAG could drop to the $22.9 point, its first support level. A further bearish movement could see Silver record more losses and return back to the $22.5 level over the coming hours.
Despite the current bearish momentum, XAG has enough support from buyers to defend its position around the $22.5 level. Buyers have been able to maintain Silver’s price above the $22 mark and would likely do so if the precious metal retraces back to its previous position.