Silver’s Bearish Outlook: Declining Momentum and Downside Risk Ahead
Silver (XAG/USD) is facing mounting bearish pressure amid weakening demand and broader market uncertainty.
Key support levels are at risk, with further downside potential in the coming days/weeks. Read on for critical insights and price targets.
Silver’s price action has shown signs of weakness, struggling to maintain higher levels amid a challenging macroeconomic backdrop. The industrial metal, known for its dual role as both a safe-haven asset and an industrial commodity, has been under pressure due to a stronger U.S. dollar, rising bond yields, and weakening manufacturing demand.
The lack of sustained buying interest and increasing short positions further contribute to the bearish case for silver.
Silver (XAG/USD) Technical Analysis
As of today [24.02.25], Silver (XAG/USD) is trading at $32.55. Recent price action indicates a failure to sustain momentum above key resistance levels, with sellers firmly in control.
The inability to reclaim resistance at $32.93 has reinforced a downward trajectory, with the next key support zone at $31.67. If this level breaks, Silver could experience a sharper decline, targeting $30.26 in the short to medium term.
Fundamental Catalysts
- Strong U.S. Dollar & Rising Yields: The Federal Reserve’s hawkish stance has supported the dollar and Treasury yields, reducing silver’s appeal as a non-yielding asset.
- Weak Industrial Demand: Declining global manufacturing activity and lower demand from key industries, including electronics and solar panels, are weighing on silver’s price.
- ETF Outflows & Institutional Selling: Silver-backed exchange-traded funds (ETFs) have seen consistent outflows, reflecting reduced investor confidence and positioning for lower prices.
- Geopolitical and Economic Uncertainty: Although silver often acts as a safe-haven asset, the broader economic environment and interest rate expectations continue to pressure its appeal relative to gold and other assets.
- Technical Weakness: The persistent failure to break above key resistance zones has led to increased selling momentum, pushing silver toward deeper retracements and potentially testing lower support key-levels in the near future.
Looking ahead, a new Silver’s bearish trend may already be underway, as long as resistance levels hold and fundamental pressures persist. A continued sell-off could drive prices lower, making it a challenging environment for silver bulls in the near term. However, traders should watch for any shifts in macroeconomic conditions or unexpected supply disruptions that could influence price action.
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