Silver Price Forecast: XAG/USD drops over 2% on high US yields, hovers near $32.00

• XAG/USD pressured by higher US Treasury yields and growing belief Fed will hold rates steady.
• Price consolidates between $32.00 support and $32.73 resistance; momentum favors bears with RSI tilting lower.
• Break below 100-day SMA at $31.91 opens path to $31.30 and $31.00; upside capped by $33.00 and $33.68.

Silver price fell 2% on Wednesday amid elevated US Treasury bond yields as investors seemed confident that the US Federal Reserve would not reduce interest rates. At the time of writing, the XAG/USD trades at $32.20, unchanged as the Asian session begins.

XAG/USD Price Forecast: Technical outlook

Silver price is set to consolidate within the $32.00 - $33.00 range, capped on the upside by the 50-day Simple Moving Average (SMA) at $32.73 and on the downside by the 100-day SMA at $31.91.

From a momentum standpoint, sellers are in charge, as the Relative Strength Index (RSI) portrays. However, price action dictates that bears must clear the $32.00 mark, followed by the 100-day SMA to aim for lower prices. In that outcome, XAG/USD's next support would be the 200-day SMA at $31.30. A breach of the latter will expose the $31.00 figure, followed by the latest cycle low seen at $28.33, the April 7 low.

Conversely, if XAG/USD clears the 50-day SMA, the grey metal would be poised to test $33.00. Once surpassed, the next stop would be the April 24 swing high at $33.68 ahead of the $34.00 figure.

XAG/USD Price Chart - Daily