Spot silver has been on the back foot, dropping from the $26.20s to the mid-$25.00s. Technical selling upon the break of a key support area appears to be the reason behind silver’s drop. Spot silver prices (XAG/USD) have taken a beating on Monday, with prices dropping all the way back into the mid-$25.00s from Asia Pacific trade opening levels in the $26.20s. That’s amounts to a drop of about 2.3% or roughly 60 cents on the day. Driving the day With the US dollar and US government bond yields broadly a little lower on the session, the selling impulse that is also being felt in gold, not just silver, does not appear to be coming from other asset classes/as a result of cross-asset correlations. Indeed, at the start of the week not much has really changed in terms of the fundamental outlook; last week’s US/China talks led to no positive breakthroughs in relations as expected, while the vaccine rollouts in the US and UK continue to go well and both countries prospects of reopening look strong, a third wave is engulfing an EU that does not have sufficient levels of vaccine-related immunity to prevent another spike in hospitalisations and deaths, meaning the bloc is heading back into lockdown. Meanwhile, the Fed continues to flex its new dovish muscles as it signals that the barrier to rate hikes (full employment and inflation that is moderately but sustainably above 2.0%) is higher than it has been in the past – nothing new on any of these fronts, hence the lack of direction in the dollar and bonds. Precious metal selling pressure thus appears to be being driven by the technicals. Looking ahead, markets are generally quite rangebound as investors focus on key events later in the week including a heavy slate of Fed speak (including Fed Chair Powell who is speaking on three occasions), preliminary US Markit PMIs on Wednesday and US Core PCE inflation data on Friday (the Fed’s favoured gauge of inflation). These events are likely to be the major macro movers of the week. Technical observations For silver specifically, spot prices broke below long-term uptrend support that has been in play since 5 March and links the 5, 14, 18 and 19 March lows and has moved all the way back to test the 14 March lows around the $25.40 area. Technical selling upon the break of this trendline was exacerbated by selling as a result of a break below support in the form of last week’s $25.80ish lows, which has already acted as a decent area of resistance. Longer-term silver bears are likely to target a move all the way back to the $25.00 area, around this month’s lows. FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next EUR/NOK to break below the 10.00-10.30 range support by the summer – Nordea FX Street 9 months Spot silver has been on the back foot, dropping from the $26.20s to the mid-$25.00s. Technical selling upon the break of a key support area appears to be the reason behind silver's drop. Spot silver prices (XAG/USD) have taken a beating on Monday, with prices dropping all the way back into the mid-$25.00s from Asia Pacific trade opening levels in the $26.20s. That's amounts to a drop of about 2.3% or roughly 60 cents on the day. Driving the day With the US dollar and US government bond yields broadly a little lower on the session, the selling impulse that… Top Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.