Silver Price Forecast: XAG/USD Holds Above $58 as Fed Decision Nears
Silver (XAG/USD) is trading near $58.05 during the European session, moving sideways as traders avoid taking large positions...
Quick overview
- Silver (XAG/USD) is trading around $58.05 as traders await the Federal Reserve's policy announcement, with an 85% chance of a 25-basis-point rate cut influencing market sentiment.
- Weak labor indicators and softer inflation have bolstered expectations for the Fed's easing cycle, supporting silver despite short-term consolidation.
- Geopolitical tensions and uncertainty in US foreign policy are driving investors towards safe-haven assets, with silver maintaining stability amid market volatility.
- Technical analysis shows silver is hovering near $58.03, with key resistance at $58.90 and support levels at $56.47 and $54.97.
Silver (XAG/USD) is trading near $58.05 during the European session, moving sideways as traders avoid taking large positions ahead of Wednesday’s Federal Reserve policy announcement. Markets now price in an 85% probability of a 25-basis-point rate cut, a shift that continues to weigh on the US dollar and support precious metals.
Weak labor indicators and softer inflation readings have strengthened expectations that the Fed may begin its easing cycle this week. For silver, lower yields reduce the opportunity cost of holding non-interest-bearing assets, helping the metal remain supported despite short-term consolidation.
Geopolitical Risks Add Support
Ongoing geopolitical tensions & a complete lack of progress in ceasefire talks in Eastern Europe, alongside significant uncertainty over US foreign policy, are sending investors scurrying for safe-haven assets. Gold investors are feeling the pinch, but silver is still doing okay during broader market meltdowns. However, the dollar is just holding its own for now & not allowing silver to break out as some folks might hope. People are waiting to see what happens next with policy before making any big moves on trends.
[[XAG/USD-graph]]
Economic Data in Focus
Tuesday’s releases, ADP employment and JOLTS job openings, may inject short-term volatility into USD pairs, but silver’s main driver remains the Fed decision and rate-path projections.
Powell’s tone during the press conference will set the direction for XAG/USD into the year-end.
A hawkish pushback could lift the dollar temporarily, while dovish confirmation may trigger a breakout higher.
XAG/USD Technical Analysis
Silver right now is trading shy of $58.03 & hovering around the upper end of its rising trend channel but its not moving up a whole lot after running into the usual resistance up at $58.90 a few times recently the last four-hour candles are just tiny little candles with no great direction indicating the price is stuck around this $57.96 mark on the 20-period exponential moving average.
A break below this area could expose the 38.2% Fib at $54.97, followed by deeper support at $53.76.
On the upside, a close above $58.90 would reopen the path toward $60.33, with the next bullish target at $61.78, the upper boundary of the long-term channel.
RSI is at 54 – so momentum’s still okay, not exhausted, but still – so silver’s still playing in a kind of neutral-to-bullish camp for now.
Key Levels to Watch
- Support: $56.47, $54.97, $53.76
- Resistance: $58.90, $60.33, $61.78
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