Silver Holds $41 as Traders Weigh Fed Cuts and Safe-Haven Demand
Silver (XAG/USD) is holding at $41.03 as investors weigh safe-haven demand against a minor US dollar rebound and strong equity markets.
Quick overview
- Silver (XAG/USD) is currently priced at $41.03, influenced by safe-haven demand amid a minor US dollar rebound and strong equity markets.
- The anticipated US Fed rate cuts in 2025 are benefiting silver, with a 50% chance of a 50bps cut next week bolstering its appeal as a non-yielding asset.
- Geopolitical risks, including recent airstrikes and political instability in various countries, are enhancing silver's safe-haven appeal despite strong equity performance.
- Technically, silver is in a rising channel with key support at $40.72, and traders are looking for a bounce from $41 to target higher levels.
Silver (XAG/USD) is holding at $41.03 as investors weigh safe-haven demand against a minor US dollar rebound and strong equity markets. Despite short term pressure, the technicals still look up and dips are being bought.
Fed Rate Cuts Help Bullion
Silver is benefiting from expected US Fed rate cuts in 2025. Recent labor market weakness has strengthened the case for easier monetary policy and the CME FedWatch Tool is showing a 50% chance of a 50bps cut next week. A more dovish Fed outlook usually hurts the dollar and helps non-yielding assets like silver and gold.
Gold is at $3,659 and that’s broad based demand for precious metals. Silver is gold’s high beta cousin and tends to amplify moves when risk sentiment shifts to safe-haven assets.
Geopolitical Risks Boost Safe-Haven Appeal
Geopolitical risks are also boosting silver. Recent events include:
- Israel’s airstrike in Qatar targeting Hamas leadership
- Poland raising air defenses as Russian attacks intensify near its border
- Political instability in France and Japan adding uncertainty to global markets
These events keep safe-haven flows active even as Wall Street hits new highs and equities strengthen.
Silver Technicals
On the 4 hour chart silver is in a rising channel since late August and is supported by the 50 SMA at $40.72. Candlestick formations like the recent Doji and spinning top show hesitation at the lower channel boundary.
The RSI is 52 which is neutral but a bullish divergence could form if price holds above $41 while RSI stabilizes. Key levels to watch:
- Upside: $41.66 then $42.20-$42.85 if bulls in control
- Downside: A break below $40.70 could see $39.56
For traders a bounce from $41 is a long setup to the channel top with a stop under $40.70.
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