- Silver futures recovery losses drop below $19.00.
- Precious metals pared their losses thanks to a weaker dollar.
- XAG/USD remains near a key support zone at $17.60/$18.10.
The recovery in silver futures from Friday’s lows at $18.00 appeared to have lost steam in Monday’s US trading session. XAG/USD has not found acceptance above $18.90, although downside attempts remain limited above $18.65 so far.
Precious metals cut losses thanks to a weaker dollar
In the absence of high-level macroeconomic releases, news of the UK government’s plan to roll back most of the tax cuts announced in September was welcomed by investors. Stock markets are posting significant gains and the safe haven US dollar has extended its decline from recent highs.
The precious metal gained ground on Monday to end a six-day sell-off, although the uptrend faltered around $19.00. The pair should cross this cap to gain momentum and aim for the resistance zone of $19.70/80.
Confirmation above the psychological level of $20.00 would negate the short-term negative trend and pave the way for the August and October highs in the $21.00 area.
On the other hand, the pair still remains dangerously close to a key support zone between $18.10 and $17.60, which contains the July, August and September lows. A reversal lower below could lead the pair to explore the June 2020 lows at the $17.00 area and the April 14, 2020 high at S15.85.
XAG/USD daily chart
Technical levels to watch