Silver Price Analysis: XAG/USD drops below $27, closes in on key support

• Silver is suffering heavy losses for the second straight day on Friday.
• Next support for XAG/USD is located ar $26.60.
• Sellers are likely to remain in control unless silver rebounds above $27.30.

The XAG/USD pair lost nearly 2% on Thursday after the surging US Treasury bond yields provided a boost to the greenback in the late American session. On Friday, the bearish pressure surrounding silver remains intact and the pair was last seen losing 1.7% on the day at $26.95.

Silver technical outlook

Following Thursday's sharp drop, XAG/USD closed below the 20-day SMA for the first time in a month and the Relative Strength Index (RSI) indicator on the daily chart dropped below 50, pointing to a bearish shift in the near-term outlook.

The 200-period SMA on the four-hour chart is forming the first technical support at $26.60. If a candle on that chart manages to close below that level, $26.20 (February 18 low) could be seen as the next target ahead of $25.90 (February low).

On the other hand, the immediate hurdle could be seen at $27.30 (100-period SMA on the four-hour chart) before $28 (psychological level/February 26 high) and $28.35 (February 23 high).

XAG/USD four-hour chart

Additional levels to watch for