Silver settled down -0.13% at 44854 as the outlook for higher borrowing costs in the U.S. strengthened the dollar and damped demand for an alternative investment. Bullion extended Monday's 2.3 percent loss, its biggest daily drop since December, as fading fears over Portugal's banking sector prompted investors to take profits, triggering stop-loss orders. Yesterday Yellen told the Senate Banking Committee earlier that rates are likely to remain on hold for a considerable period after the bank’s quantitative easing program ends, though her observation that small-cap, biotech and other momentum stock valuations appear "stretched" gave the dollar support, leaving investors to conclude that interest rates could rise sooner than later if the labor market improves, which sent bullion falling. Yellen's comments overshadowed mixed U.S. data, which depicted an economy that continues to recover albeit on a road with lingering potholes. The Commerce Department reported that U.S. retail sales rose just 0.2% in June, below forecasts for a 0.6% increase. Retail sales for May, however, were revised up to 0.5% from a previously reported 0.3%. A separate report showed that manufacturing activity in New York state rose to a four-year high this month. The Empire state manufacturing index rose to 25.6 in July from 19.3 in June. Meanwhile Holdings in total known ETFs backed by silver still remained up 3.6% year-to-date even despite a mild decline thought the last month. Technically market is under long liquidation as market has witnessed drop in open interest by -7.94% to settled at 7128 while prices down -58 rupee, now Silver is getting support at 44547 and below same could see a test of 44239 level, And resistance is now likely to be seen at 45217, a move above could see prices testing 45579.

Trading Ideas:

Silver trading range for the day is 44239-45579.

Silver prices dropped after Federal Reserve Chair Janet Yellen delivered an reasonably upbeat take on the U.S. economy.

Yellen told the Senate Banking Committee that U.S. economy continues to improve but added that the recovery is not yet complete.

Yellen's comments overshadowed mixed U.S. data, which depicted an economy that continues to recover albeit on a road with lingering potholes.