Silver Price Analysis: XAG/USD stumbles, falling back into $23

Silver is falling further back to kick off the new trading week, testing into familiar lows after last Friday's bounce couldn't be sustained.

The Federal Reserve (Fed) is set to see interest rates holding higher for longer than previously expected, and the boost to the US Dollar Index (DXY) is capping off recent upside swings for the XAG/USD.

After the Fed upped their interest rate forecast, or "dot plot" last week, the US central bank expects interest rates to only decline half a percent by the end of 2024. The Federal Open Market Committee (FOMC) previously saw end-2024 rates at 4.6%, but sticky inflation complications saw the Fed up their forecast to 5.1%.

XAG/USD technical outlook

On the hourly candles, Silver is looking to build a floor near the 200-hour Simple Moving Average (SMA) near $23.15 after tumbling around 2.5% from Monday's highs near $23.65.

Intraday upside momentum will be looking to recapture familiar territory north of the 100-hour SMA currently settling near $23.35.

Silver is suffering from a notable lack of meaningful trend momentum in the long-term, with the XAG/USD cycling the 200-day SMA on daily candlesticks.

Price action is constrained to the middle as Silver consolidates, with lower highs and slightly higher lows trapping XAG/USD into the midrange.

Swing lows are pricing in near $22.40, with the top end set to run into a descending trendline near $24.40.

XAG/USD daily chart

XAG/USD technical levels