Silver Price Forecast: Bulls Defend $47 as Fed Rate Cut and Dollar Weakness Fuel Recovery
Silver steadies near $47.70 after the Fed’s rate cut to 4%. Weak dollar and easing yields spark rebound hopes as traders eye a breakout towa
Quick overview
- Silver is stabilizing around $47.71 after a decline from its $52.43 peak, indicating a potential temporary bottom.
- The recent Fed interest rate cut to 4.00% has renewed interest in precious metals, making them more attractive to investors.
- Improved market sentiment ahead of U.S.–China trade updates and easing bond yields is boosting demand for commodities like silver.
- Technical indicators suggest a possible bullish trend for silver, with key price levels to watch for traders.
Silver has been steadying itself, hovering near $47.71 through the Asian trading hours, a possible signal that it’s found a temporary bottom after taking a hit from its $52.43 peak earlier this month. It seems to be putting in some work to recover from a pretty short-lived downturn, helped along by a renewed interest in the precious metals market following the Fed’s surprise decision to chop the interest rate down to 4.00% from 4.25%.
A dip in the US Dollar Index – it fell by 0.2% after the surprise – has made silver and gold look more attractive to investors globally. With interest rates coming down, you have less reason to put your money in something that doesn’t pay a dividend, but on the other hand, the world’s getting a bit more uncertain by the day so that’s making safe-haven assets desirable.
Market sentiment also improved ahead of U.S.–China trade updates and easing bond yields, which collectively revived appetite for commodities tied to industrial and monetary cycles.
Fed Rate Cut and Macro Impact
The Fed’s latest policy adjustment marked its second cut of the year, bringing the benchmark range to 3.75%–4.00%. However, Chair Jerome Powell’s cautious tone signaled internal divisions on future easing. Analysts note that this uncertainty could keep volatility elevated across metals markets.
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Silver, which serves both as an industrial and monetary metal, tends to outperform gold during the early stages of monetary easing. A lower-rate environment boosts liquidity while supporting industrial output, especially in solar energy, electronics, and EV manufacturing, where silver demand is structurally growing.
If geopolitical tensions ease and global growth steadies, silver could find itself in a stronger position than gold heading into 2025.
Silver (XAG/USD) Technical Outlook: Rebound in Progress
On the four-hour chart, silver has finally broken out of that descending channel, and is now consolidating around $47.25 – a level which has been acting as a pretty reliable floor for it up until now.
The 20-period EMA is looking like it might be getting ready to turn around, which could be a sign that the trend is about to change, and the RSI is sitting at around 47, having come back from being oversold – all of which suggests that things might finally be starting to turn around for silver.
Candlestick patterns such as long lower wicks and spinning tops suggest that buyers are regaining control. A move above $47.90 could trigger a run toward $49.38 and $50.84, confirming short-term bullish momentum. However, a drop below $47.25 could expose downside targets at $45.54 and $44.20.
Silver Trade Setup and Outlook
Traders could consider a long entry above $47.90, targeting $49.38 and $50.84, with a stop-loss below $47.20. Alternatively, a short setup below $47.20 may target $45.54 if selling resumes.
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