Silver Price Analysis: XAG/USD soars amid soft Indutrial Production and Jobless Claims figures from the US

• The XAG/USD trades at $23.80, its highest since early September.
• The USD and Treasury yields tumbled after soft economic data was reported from the US.
• As long as investors bet on a less aggressive Fed, it will benefit the grey metal.

The XAG/USD  saw significant upward movements in Thursday's session, soaring to $23.80, seeing more than 1.50% gains. The metal increased amid soft Industrial Production and Jobless Claims, which fuelled a decline in US yields, allowing the metal to gain interest.

The Initial Jobless Claims for the week ending November 10 in the US experienced a significant rise to 231,000, surpassing the projected 220,000 and setting a three-month high. Additionally, Industrial Production for October fell short of expectations, showing a 0.6% drop on a month-on-month basis, beating the 0.3% decrease expected. Following the release of the data, the US Treasury yields, typically viewed as the cost of holding non-yielding metals,  sharply declined. The 2-year bond rate decreased to 4.83%, while the 5-year and 10-year yields dropped by 4.42% and 4.44%, respectively. 

It's worth noticing that the US economy has recently reported evidence of inflation and job creation cooling down, making investors confident that the Federal Reserve (Fed) won't take a more aggressive stance in its next meetings. Adding to that, the bank official also stated that they needed to see further evidence of the economy decelerating so the reports of  soft Consumer and Producer Price Indexes, the rising Jobless Claims and weakening Industrial Production, strengthened the case of a more dovish monetary policy. Meanwhile, the CME FedWatch tool indicates that the market has already factored in a pause in December and is now pricing in rate cuts for April- May 2024. Consequently, as long as the US Dollar weakens and investors anticipate a less aggressive Federal Reserve, the price of silver could continue to rise.

XAG/USD levels to watch

On the daily chart, the XAG/USD now holds a bullish technical bias, as indicators suggest that the buyers are in command. The Relative Strength Index (RSI) indicate positive momentum with an ascending slope above its midline, while the Moving Average Convergence (MACD) histogram prints larger green bars. Zooming out, the pair is above the 20,100,200-day Simple Moving Average (SMA), suggesting that the bulls are also firmly in control of the overall trend.

Supports: $23.50, $23.30 - $23.20 (200 and 100-day SMA convergence).
Resistances: $24.00, $24.30, $24.50.

XAG/USD daily chart