Silver traded within a subdued range on Monday, attempting to steady itself following Friday's sharp 4.11% decline. The precious metal is currently digesting recent macroeconomic shifts while traders carefully monitor key technical thresholds.
Technical Indicators Point to Fading Momentum
From a technical standpoint, the latest downward push has caused XAG/USD to slip beneath its 100-day Simple Moving Average (SMA), tilting the near-term directional bias toward a more cautious or bearish stance. However, the metal continues to hold its ground above the 50-day SMA at $61 and a crucial Fibonacci support band ranging between $60.97 for the 61.8% retracement and $64.79 for the 38.2% level.
The Relative Strength Index (RSI) on the daily timeframe sits at 53, remaining inside neutral territory after retreating from levels above 60. This easing suggests that bullish momentum is gradually losing steam. Concurrently, the Moving Average Convergence Divergence (MACD) indicator hovers flatly near the zero line, pointing toward an extended phase of consolidation before the next decisive breakout.
Key Support and Demand Zones
Should the downward pressure persist, immediate support is established at the 38.2% Fibonacci retracement level of $64.79. Deeper demand pockets are located at the 50% retracement level of $62.88 and the 61.8% retracement level at $60.97, with the 50-day SMA at $61 acting as a robust safety net during extended pullbacks.
Macro Factors and Currency Markets
Broader macroeconomic sentiment has been heavily influenced by comments regarding inflation, which initially propelled the US Dollar to multi-week highs and pushed the Dollar Index (DXY) as high as 99.72 as markets repriced September rate expectations. The CME FedWatch Tool indicates a 65% probability of a 25-basis-point rate hike at the upcoming Federal Reserve meeting. Despite that initial surge, the Greenback retraced a significant portion of those gains, with the DXY trading near 99.44 during Monday's session.
Other major currency pairs and asset classes are reacting similarly to shifting dollar dynamics. The GBP/USD pair recovered a portion of its recent three-day retracement, hovering near the 1.3550 region as downward pressure on the Greenback aids risk-correlated assets. Meanwhile, EUR/USD surpassed the key 1.1600 hurdle as selling momentum against the dollar picked up pace.
Gold extended some of its Friday losses, though it successfully bounced off earlier lows beneath the $4,400 per troy ounce threshold. Despite a softer dollar and ongoing geopolitical tensions in the Middle East, rising yields have kept aggressive buyers at bay. In the digital asset space, Bitcoin maintained resilience above $78,000 with sights set on $80,000, Ethereum held steady above $2,400, and Ripple showed early recovery signs near $1.37.
Energy markets present a stark divergence in refined products, as the US diesel crack spread recently surged past $100 per barrel for the first time, notching an intraday record high just above $102.00 even as crude oil markets appeared relatively calm.
