Silver Price Forecast: Price Volatility as Treasury Yields Rise

The price of silver attempted to break out, but again encountered selling resistance. The decline in gold prices weighed on the broader precious metals market. The Fed's quiet period has begun in advance of the FOMC's mid-month meeting.

The benchmark rates continued to rise, with the 10-year yield ending over 3%.

Prior to the Fed FOMC meeting, there is a period known as the quiet period, during which members refrain from commenting on Fed policy.

Prior to their June 14-15 monetary policy meeting, Fed policymakers have entered a period of silence. Last week, yields continued to climb as a result of a robust employment report. The Fed Funds futures contract for the end of the year is currently pricing in rates of 2.70 percent, implying another 100 basis points of tightening over the next two meetings.

Technical Evaluation

The price of silver sought to climb higher but was unable to do so. Near the 10-day moving average of 21.99 is viewed as support. At the 50-day moving average of 23.18, there is observed to be resistance.

The 50-day moving average continues below the 200-day moving average, representing a headwind for XAG/USD and indicating negative trend. Silver will likely reach the level of 20.4.

The medium-term momentum turns positive when the histogram and MACD both show positive values (moving average convergence divergence). The MACD histogram is moving in negative area, indicating a downward trend in price movement.