Silver Price Forecast: Daily range holds, but 4-hour chart turns bearish
- Silver slides as the stronger US Dollar weighs on precious metals.
- The daily chart shows XAG/USD holding inside its range since mid-August, with the 100-day SMA capping the upside.
- 4-hour momentum turns weaker as Silver tests the 50-period SMA.
Silver (XAG/USD) slides nearly 3% on Wednesday as the hawkish Federal Reserve (Fed) outlook pushes the US Dollar (USD) to a two-month high and weighs on non-yielding metals. Gold (XAU/USD) is also down more than 1%. At the time of writing, XAG/USD trades around $65.
Despite the fundamental headwinds, the white metal remains within the range it has held since mid-August. Momentum indicators on the daily chart show neither buyers nor sellers in clear control, while the 100-day Simple Moving Average (SMA) near $66 continues to cap the upside.
The Relative Strength Index (RSI) is hovering near the 50 line and the Moving Average Convergence Divergence (MACD) is just below zero, which suggests a lack of directional conviction despite the underlying support from the 50-day SMA at $63.
The subdued Average Directional Index (ADX) near 12 hints that any break of these nearby support or resistance levels would be needed to re-energize trend conditions and define a clearer directional bias.
On the upside, a break above the 100-day SMA at $66 would bring the top of the recent range near $70 into view, followed by the 200-day SMA at $73. On the downside, the 50-day SMA at $63 sits close to the range floor. A break below it would expose $60, then $55.
The daily chart still shows Silver trading within its range, but the 4-hour chart tells a weaker short-term story. XAG/USD has pulled back from $67.50 and is now testing the 50-period SMA near $65, after slipping below the 100-period SMA at $65.35 and the 200-period SMA at $66.
The Relative Strength Index (RSI) is around 45 and an expanding negative Moving Average Convergence Divergence (MACD) histogram points to growing selling pressure. For buyers, the first step is to reclaim the 100-period SMA at $65.35 followed by the 200-period SMA at $66. Above that, Silver faces barriers at $67.50 and $70.50.If Silver loses the 50-period SMA, $63 is the next level to watch. A break below that area would also take the metal out of its recent range and bring $60 into focus.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
Author
Vishal Chaturvedi
FXStreet
I am a macro-focused research analyst with over four years of experience covering forex and commodities market. I enjoy breaking down complex economic trends and turning them into clear, actionable insights that help traders stay ahead of the curve.
