Silver Holds the Rebound While Dollar and Yields Pull Apart
Silver gave back eight cents Monday after Friday’s run toward $67.30 and that was the extent of the selling. The rebound off last week’s $62.31 low is intact. Buyers are not chasing. Sellers are not pressing. The tape went flat on thin early European liquidity with New York still hours away. Eight cents on a metal that just bounced $4 off the bottom is a market catching its breath, not one changing direction.
At 11:06 GMT, Spot Silver (XAGUSD) is trading $65.86, down $0.40 or -0.60%. The U.S. Dollar Index is trading 100.320, up 0.105 or +0.10%. The 10-year Treasury yield is at 4.959%, down 0.041 or -0.82%.
Daily Spot Silver Technical Analysis
The main trend is down on the daily swing chart. Silver posted a lower high at $68.33 after the $71.18 top and broke to a lower low at $62.31.
The first upside test is the minor top at $67.34. Above that, $67.79 and then $68.33. The 200-day moving average at $73.15 remains well above the market.
On the downside, $65.32 is the first support. Below that, the 50-day moving average at $63.14 and $62.98 form a cluster near the $62.31 low. The $61.04 to $60.84 area is the next support zone.
The Dollar Stalled the Rally That Yields Were Trying to Start
The 10-year backed off the 5.041% high and is down to 4.959% Monday. That is the kind of session that should have given silver room to run. The Dollar Index took that away. A tenth of a percent firmer near 100.32 after recovering from last week’s low. Not a big move. Enough to cool the metals bid after two straight sessions of gains. When the dollar and yields split like that, silver does not move and Monday was a textbook example.
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The Fed raised 25 basis points last week to 3.75%-4.00% and signaled at least one10 more increase this year. Rate markets pushed October hike odds higher. The front end of the curve is locked in after the decision. Silver needs the currency to cooperate before the yield decline translates into anything on the chart. Monday’s session said the currency side is not ready.
Four Sessions of Lower Crude and the Inflation Calendar Has Not Changed
Oil has been falling since Thursday. Brent slipped under $102. WTI broke below $100. The Saudi export recovery through the Strait of Hormuz and the diplomacy noise heading into the U.N. General Assembly are doing the work.
Four days of cheaper crude is a good start. The problem is the inflation data the Fed is watching still reflects the supply shock. Last week’s hike landed on old numbers. The next round of prints has to show the energy decline feeding through before the rate conversation shifts. Until then the crude decline is background. Silver is trading the rate outlook and the rate outlook has not responded to cheaper oil yet.
A Houthi strike or another Strait disruption flips crude higher fast and puts inflation back at the front of the conversation. The four-day decline in crude could disappear on one headline. The diplomacy around the U.N. General Assembly could extend it if there is progress. Neither outcome has happened yet and silver is waiting for both.
Gold-Silver Ratio Near 66 Says the Rebound Has Legs
The ratio tells the story of the past week. Silver outperformed gold on the bounce off the lows and it held that outperformance Monday while gold took the bigger hit. A falling ratio during a rebound is the market saying industrial and speculative buyers are leaning toward the white metal over the yellow one.
Profit-taking after Friday’s $67.30 high is part of the flat tape. Early Monday volume is thin. European desks just got started. A small amount of selling in that window keeps the price quiet without damaging the structure built off $62.31. New York is where the real flow shows up. Whether $65.32 holds when full liquidity arrives decides the day.
Silver has held together better than gold since the rebound started. That relative strength heading into a week with central bank speakers on the calendar is worth watching. If the dollar fades, silver is the one with the momentum.
What to Watch
The Chicago Fed National Activity Index hits at 12:30 GMT. Chicago Fed President Austan Goolsbee speaks later in the day. ECB President Christine Lagarde and Bank of Canada Governor Tiff Macklem are also on the schedule. After last week’s hike every comment gets pulled apart for direction on how many more increases are coming. Goolsbee’s tone matters more than the activity index. If he backs away from October urgency and the dollar fades alongside it, silver has a path to another run at $67.34.
Buyers have to get through the minor top at $67.34 and then deal with $67.79 before the lower high at $68.33 comes into play. Clearing $68.33 turns the main trend higher. The 200-day at $73.15 is well above and not part of this week’s conversation.
On the downside, $65.32 is where the rebound is either intact or it is not. Below it, the 50-day at $63.14 and $62.98 are the next test. The $62.31 low is the line. Below that, sellers have a path into the $61.04 to $60.84 zone. Silver is holding the bulk of a $4 rebound and the structure off the low has not cracked. Buyers keep the edge above $65.32.
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