On 19 August, the US Treasury announced that it would double the volume of its long-term government bond buybacks. Under these operations the Treasury repurchases outstanding longer-dated securities, funding the purchases with shorter-dated bills — a tool the department reintroduced on a regular basis in 2024 to support liquidity in older issues. The measure contributed to a noticeable decline in yields at the longer end of the curve and forms part of the Treasury's broader efforts to contain pressure on long-term borrowing costs. Those efforts include market interventions and calls for the Federal Reserve to expand the limits of the FIMA repo facility, which allows foreign monetary authorities to obtain dollar liquidity by temporarily posting their Treasury holdings as collateral rather than selling the bonds outright.

Lower Treasury yields improve the relative appeal of precious metals, which do not generate interest income, providing direct support for silver. The metal's dual character is worth keeping in mind here: as well as functioning as a store of value, silver is an industrial commodity, and industrial applications account for the largest share of annual silver demand, with solar photovoltaics a major and growing component. Industrial demand is a further supportive factor in the current setting: Chinese imports of silver-containing ores rose 62.5% year-on-year in June, driven by expanding production of solar panels and power-grid equipment.

Technical Analysis of Silver

XAG/USD has been moving within a pronounced uptrend on the four-hour chart since 17 July. In the upper portion of this advance, a pattern resembling a broadening triangle emerged in mid-August. Unlike a conventional triangle, its boundaries widened rather than converged, reflecting increasing volatility during the consolidation phase.

On 20 August, the price broke above the formation and has continued to hold above the current market profile. The breakout candle was accompanied by a noticeable increase in vertical volume compared with the preceding consolidation bars, adding some confirmation to the move.

Following the breakout, silver moved above the profile's upper boundary at $66.58. If the bullish momentum persists, the next major upside reference is the red resistance level at $69.74.

A return inside the profile would shift attention to the cluster of two important levels: the Point of Control (POC) — the price that recorded the highest traded volume within the profile — at $65.165 and the lower profile boundary at $64.345. Their proximity makes this area particularly important for the short-term outlook. If sellers push the price through this cluster, the next potential support could be found around the green level at $62.700.

The RSI + MAs indicator currently shows readings of 66, 56, and 56. The oscillator is trading above the neutral zone, while both moving averages remain below its upper boundary and are only beginning to approach a potential breakout.

The breakout above the broadening triangle on increased volume initially points towards further upside, although maintaining prices above the market profile will require additional confirmation. The $66.58 level is therefore likely to remain important in the near term: holding above it would favour continuation towards $69.74, while a return below the profile could bring the 65.165–64.345 area back into focus.

The broader outlook will also remain sensitive to the direction of US Treasury yields. A continued decline in yields could provide further support for silver, while a renewed rise in long-term yields could limit the metal's upside. The Treasury's buyback operation schedule and any Federal Reserve response regarding the FIMA facility's limits are the accompanying developments to monitor, as they bear directly on the long end of the curve.