Silver Price Analysis: XAG/USD rebounds from earlier sub-$21.50 lows, still weighed by higher buck/US yields

• Silver prices are under pressure on Tuesday, though have recovered substantially from earlier session lows.
• XAG/USD dipped as low as under $21.50 before recovering closer to $22.00 amid the stronger dollar/higher US yields.

Though spot silver (XAG/USD) prices are still trading lower by about 0.3% on the day, they have erased the lion’s share of earlier losses and are back to trading in the $21.90s per troy ounce, more than 2.0% above earlier session lows under $21.50. That means spot prices continue to trade relatively close to their 21DMA (in the $21.80s) and only a little over 2.0% below last week’s highs near $22.50.

Month-end strength in the US dollar plus a month-end rebound in US bond yields, which some say is also being boosted by hawkish remarks from Fed Board of Governors member Christopher Waller on Monday, are the primary factors weighing on silver and precious metals more broadly on Tuesday. Recent US data in the form of housing figures, Chicago PMI and CB Consumer Conference numbers haven’t factored much into the equation.

Silver continues to trade about 7.0% above mid-month lows in the mid-$20s and, as Wall Street chatter about US inflation/Fed hawkishness having peaked builds, the prospects for a more lasting rebound are improving. But, for now, price action seems content in remaining glued to the 21DMA and ahead of key US data releases later in the week, this is likely to remain the case.