Silver Price Analysis: XAG/USD weighed by pre-US risk event profit-taking, might snap six-day win streak

• Spot silver is pulling back a little after hitting one-month highs in the $25.80s amid profit-taking pre-US risk events.
• XAG/USD is back to trading in the $25.50s and on course to snap a six-day win streak.

Spot silver (XAG/USD) prices are subdued and trading in the red in the $25.50s per troy ounce the March US Retail Sales report at 1330BST, the preliminary US Michigan Consumer Sentiment survey at 1500BST and then more Fed speak later in the day. US bond yields and the US dollar continue to see some weakness, though profit-taking ahead of upcoming risk events and following the strong performance of recent days is preventing XAG/USD from further closing the gap to $26.00.

Indeed, the precious metal closed in the green for a sixth successive session on Wednesday, during which time it has rallied more than 6.5% from the low $24.00s to current levels in the upper $25.00s. Prices actually managed to hit one-month highs earlier in the day at $25.87, so traders shouldn’t be too surprised to see some profit-taking/consolidation at play.

In terms of the near-term outlook for silver, as long as the recent pullback in US yields and the dollar continues, the chances for a break above $26.00 remain good. Silver, as is also the case with other precious metals, will likely remain in demand for some time amid 1) elevated geopolitical risk premia and 2) elevated demand for inflation protection as inflation rates surge globally. That means, unless circumstances change drastically, XAG/USD should remain well supported above the $24.00 level, as has been the case in the last few weeks.