Silver meets daily resistance, downside continuation on the cards

• Silver meets a 61.8% Fibonacci retracement of daily bearish impulse.
• FOMC and the bond market will be key as well as Retail Sales. 

XAG/USD ended the day at $25.9240 on Friday and has started out 0.42% higher having traded between the $25.90 low and a $26.06 high. 

The focus was again on the US dollar which climbed on Friday following a fresh spike in Treasury yields as the prospect of economies emerging from year-long coronavirus lockdowns reignited inflation fears.

The markets are pricing in pent-up consumer demand could lead to a jump in inflation. 

Data on Friday was in focus as well that showed that the US Producer Prices Index (PPI) had their largest annual gain in nearly 2-1/2 years.

Meanwhile, US President Joe Biden signed a $1.9 trillion stimulus bill into law on Thursday and the prospects of all being eligible for a coronavirus vaccine by May 1 has lifted risk mood in markets, leading to a selloff in Treasuries.

The yield on the benchmark 10-year note was hitting a fresh one-year high of 1.6420%, helped by optimism around US economic prospects.

For the week ahead, the FOMC and the bond market will be key and PPI will also garner some attention while investors weigh the outlook for the US dollar.

Silver technical analysis

The price remains in bearish territory and failures in the 26 area will put a focus back on the recent lows and the probability of a downside extension.

The daily chart shows price stalling at a significant 61.8% Fibonacci retracement level of the latest bearish impulse. $24.2790 guards $23.57 for the sessions ahead.