XAG / USD remains subdued around $ 22.50 on falling US T-bond yields

• The white metal extends its gains for three days, up 0.22%.
• Falling returns and risk aversion add to the precious metal’s prospects and weaken the dollar.
• Technical outlook for XAG / USD: Slightly upward but needs to recapture the $ 23.50 region.

Silver (XAG / USD) barely gains during the New York session but is expanding its gains for the third day in a row, trading at $ 22.53 at the time of writing. Market sentiment is grim, as declining global stock indices show as US T-bond yields continue their post-Fed freefall, with 10-year US Treasury yields falling three basis points to below 1.40%.

Meanwhile, the US dollar index, which measures the performance of the greenback against a basket of six peers, is up 0.28% and currently stands at 96.32.

Factors such as a risk-free environment and falling US T-bond yields supported the non-profitable metal. Silver bulls are targeting a break above the December 6th swing high at $ 22.59. Once broken sharply, XAG / USD could rally towards the confluence of the 50 and 100 day moving averages (DMAs) around $ 23.45-50. However, you would encounter medium resistance around the $ 23.00 threshold.

The Relative Strength Index (RSI), a momentum indicator around 45, is pointing up and would support a bullish bias; however, caution should be exercised as the RSI remains below the 50 center line and does not trigger a bullish signal.

On the flip side, a failure at USD 23.00 could rock XAG / USD. The first zone of demand would be the December 16 swing low of $ 21.90. Breaking the latter would reveal key support levels such as the December 15th low at $ 21.40 followed by the YTD low on September 30th at $ 21.33.

Daily chart