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The USD index (DXY) reached a fresh multi-week high above 99.50 during the American session on Thursday before reversing lower, currently battling to maintain the 99.00 level. This shift in USD momentum coincided with a bearish breakout in silver's descending channel, signaling potential sustained losses for the precious metal. Technical indicators suggest the breakdown below key support levels could accelerate downward pressure on silver prices.
For traders, the USD index's volatility reflects broader market uncertainty ahead of upcoming U.S. economic data releases. A sustained decline below 99.00 for DXY might weaken the dollar's dominance, indirectly supporting non-dollar assets like gold and silver. However, the current bearish bias in silver's technical pattern suggests short-term risks for commodity bulls.
Investors should monitor the USD index's ability to reclaim 99.50 as a potential reversal catalyst. For silver, critical support at $22.00 per ounce will be a key level to watch. Broader market sentiment, including Fed policy signals and global risk appetite, will likely dictate the next directional move for both assets.
