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Silver's price advanced for the second consecutive day, registering gains of over 0.48%. It trades at $32.37 a troy ounce and is about to test the key resistance level at $32.64, the February 7 swing high.

XAG/USD eyes key resistance as DXY plunges to two-week low

Tariffs are the name of the game and the most important driver during the North American session. US President Donald Trump ordered advisors to devise ‘reciprocal’ tariffs against US trade partners.

After the headlines crossed the screens, the Greenback depreciated sharply against a basket of six currencies known as the US Dollar Index (DXY). The DXY plummets over 0.85%, down at 107.04, near two-week lows.

In the meantime, the US Producer Price Index (PPI) for January rose by 0.4% month-over-month (MoM), surpassing the anticipated 0.3% and showing a slight decline from December's 0.5%. Year-over-year (YoY), the PPI held steady at 3.5%, exceeding expectations.

At the same time, core PPI, which excludes volatile food and energy prices, also reported an increase, with monthly figures climbing by the expected 0.3%. Over the twelve months to January, the core PPI rose by 3.6%, 0.3 percentage points above the forecasted 3.3%.

Other data showed the labor market remains strong after Initial Jobless Claims for the week ending February 8 dropped to 213K, below the projected 215K and down from the prior week's 220K.

XAG/USD Price Forecast: Technical outlook

From a technical standpoint, Silver is upwardly biased but about to face stir resistance at $32.64. The Relative Strength Index (RSI) shows that buyers are gathering some steam, and if they clear the previously mentioned resistance level, the next ceiling level would be $33.00.

A breach of the latter will expose the October 31 peak at $33.89, followed by the October 29 high at $3454.

Conversely, if Silver falls beneath $32.00, the first key support would be the 100-day Simple Moving Average (SMA) at $31.12.

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