Silver bulls are making headway towards a 38.2% Fibo recovery

• Bulls are attempting to correct the strong downward pressures imposed by the greenback.
• Silver traders will be looking to the Fed's chair today for insight into the central bank's policy roadmap.

At the time of writing, XAG/USD is trading at $25.94 and is virtually flat on the session following a strong start to the week where it ended higher by 0.65%. Silver travelled from a low of $25.55 to a high of $26.08.

All in all, it was a solid day for commodities that were recovering on weakness in the greenback and within a risk-on environment.

Financial and commodities markets steadied in the aftermath of last week’s Fed hawkish hold announcement and Fed speakers are in focus.

Traders are paying special attention to Fed speakers this week.

Overnight, we heard from NY Fed President Williams who said the economy hasn't improved enough to pare policy stimulus. His comments were accompanied today by those of St. Louis Fed President James Bullard who has cited the "upside risk" of potential inflation and said that the central bank will have to stay "nimble" as the US economy reopens after the COVID pandemic.

Meanwhile, the chair, Jerome Powell, is testifying to Congress where analysts are expecting him to attempt to impose his assessment that the very strong inflation prints we’ve seen recently will fade.

This could be a weight on the greenback and support precious metals, especially if he explicitly pushes back against the idea of a 2022 rate rise and ensuring that financial market conditions remain orderly.

Silver technical analysis

Technically, silver is attempting a recovery but so far, the price is falling well short of a significant retracement.

A 38.2% Fibo comes in at $26.60. On failures at the current level, there are prospects of another bearish leg towards a test of $ 25.00.