-1.70% for Silver as upward momentum faces overbought short-term signal

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Silver drops 1.7% today to $65.88

Highlights

The US Treasury Department doubled the size of its buyback operations for longer-dated nominal coupon securities, leading to a sharp drop in Treasury yields and the US Dollar.
This shift in policy improved liquidity conditions and increased the appeal of non-yielding assets such as Silver, though selling pressure continues to impact price action.
XAG/USD trades within a projected $63.89 to $67.87 range over the next 2 to 3 days, with technical indicators showing strong short-term bullish momentum but intraday weakness below key long-term resistance.

Yield-driven demand shift as Treasury buybacks boost silver appeal

The US Treasury Department doubled the size of its buyback operations for longer-dated nominal coupon securities, resulting in a sharp decline in US Treasury yields and the US Dollar, according to Exchangerates Org. This policy shift altered liquidity conditions and boosted the appeal of non-yielding assets such as Silver. The news provided a supportive environment for Silver, though price action has remained under broader selling pressure.

Mixed signals as intraday buyers face technical resistance

On the H4 timeframe, XAG remains above its MA-20 and MA-50 but below the MA-200, highlighting mixed technical signals. The Ichimoku Kijun at $64.94 acts as near-term support. Bull/Bear Power indicates overbought intraday conditions, and the Awesome Oscillator supports upward momentum. MACD, ADX, RSI, and CCI all signal buy, while Stoch RSI reads as neutral, reflecting robust but cautious short-term momentum for Silver.

Bullish bias prevails as upward probability outweighs downside risk

Over the next 2 to 3 trading days, XAG is expected to fluctuate within a volatility band of $63.89 to $67.87. The probability of an upward move stands at 76%, making a further decline less likely in the short term. The baseline outlook is stabilization within this range; a bullish scenario unfolds if XAG breaks above the upper resistance, while a bearish case emerges if the price drops below the Kijun support at $64.94, potentially targeting the lower band.

Viktoras Karapetjanc, expert at Traders Union, highlights the positive impact of US Treasury buyback operations on the demand for Silver. He sees the macro environment as supportive and notes that technical signals remain broadly constructive in the short term. Karapetjanc believes that momentum and sentiment both favor a stabilization or bullish move for XAG. "With strong policy tailwinds and solid technical setup, I expect Silver to maintain its gains and potentially test new highs soon."

Earlier, analysts noted that silver displayed strong short- and medium-term momentum following U.S. Treasury policy shifts, but faced persistent longer-term resistance. The current analysis reinforces this outlook, highlighting that traders should monitor the $67.87 resistance and $64.94 support levels for the next significant directional move.

Source of Data: XAG Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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