Silver Price Tumbles To Near $28.70 As USs Dollar Recovers Ahead Of US Data

Silver price (XAG/USD) falls sharply to near $28.70 in Thursday’s European session after posting a fresh weekly high at $29.16. The white metal drops as the US Dollar (USD) rebounds strongly, and the Caixin Manufacturing PMI surprisingly contracted in July.The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, jumps higher to near 104.35 after rebounding from a weekly low of 103.86. A sharp recovery in the US Dollar has made investment in Silver expensive for investors.Apart from that, unexpected decline in the Caxin Manufacturing PMI to 49.8 from expectations of 51.5 and the prior release of 51.8 has weighed on the Silver price. Silver as a metal has application in various industries such as renewable energy and electric vehicles etc. And, a slowdown in China’s manufacturing sector raises concerns over Silver demand.However, firm speculation that the Federal Reserve (Fed) will start reducing interest rates in September will keep the downside limited. The Fed left interest rates unchanged in the range of 5.25%-5.50% on Wednesday, as expected, and his acknowledgment of cooling price pressures and easing labor market strength pointed to expectations of rate cuts sooner rather than later.Going forward, investors will focus on the United States ISM Manufacturing PMI and Nonfarm Payrolls (NFP) report for July, which will be published at 14:00 GMT and on Friday, respectively. Silver technical analysisSilver price hovers at make or a break near the horizontal resistance plotted from June 13 low at $28.66 on a four-hour timeframe. The asset climbs above the 50-period Exponential Moving Average (EMA) near $28.70, suggesting that the near-term trend is upbeat.The 14-period Relative Strength Index (RSI) moves higher above 60.00. If the RSI sustains above 60.00, the momentum will shift to the upside. Silver four-hour chart More By This Author:US Dollar Edges Lower In Countdown To Fed Policy Gold Price Gains On Middle East Tensions, Focus Is On Fed Policy Silver Price Forecast: XAG/USD gives up intraday gains after upbeat US JOLTS Job Openings