Silver Price Forecast: XAG/USD stays in a tight range around $31 with US Inflation in focus


  • Silver price trades sideways around $31.00 as investors await the US Inflation report for June.
  • Fed Powell signaled that the labor market strength appears to be easing.
  • Silver price holds the Falling Channel breakout.

Silver price (XAG/USD) trades sideways near $31.00 in Wednesday’s Asian session. The white metal consolidates even though the commentary from Federal Reserve (Fed) Chair Jerome Powell, in his semi-annual Congressional testimony on Tuesday, indicated that risks to the Fed’s dual mandate are finely balanced.

Fed Powell acknowledged that labor market conditions are no tighter enough that was experienced after mammoth liquidity infusion in pandemic era. On inflation, Powell commented that the Fed has made some progress in inflation in recent months and more good data would bolster the case for looser monetary policy, Reuters reported.

However, Powell still not delivered any timeframe for rate cuts but his commentary has kept strength in market expectations for the Fed to begin reducing interest rates from September intact.

Meanwhile, the US Dollar (USD) has remained under pressure ahead of the United States (US) Consumer Price Index (CPI) report for June, which will be published on Thursday. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, gains ground above the almost four-week low of 104.85.10-year US Treasury yields and consolidates around 4.30%.

Silver technical analysis

Silver price extends its upside to near $31.00 after a breakout of the Falling Channel formation on a four-hour timeframe. An upside break of the above-mentioned chart pattern results in a bullish reversal. Upward-sloping 20-day Exponential Moving Average (EMA) at $30.70, exhibits a bullish trend.

The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, indicating that momentum has shifted to the upside.

Silver four-hour chart

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.

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD drops to three-week lows near 1.0790

EUR/USD drops to three-week lows near 1.0790

The Greenback is picking up extra upside impulse and is dragging EUR/USD to the area of multi-week lows around 1.0790, a region also coincident with the provisionbal 100-week SMA.

EUR/USD News
GBP/USD remains offered, challenges the 1.2900 support

GBP/USD remains offered, challenges the 1.2900 support

GBP/USD now reverses its initial uptick and puts the key 1.2900 contention zone to the test amid further buying interest in the US Dollar on Monday.

GBP/USD News
Gold nears $3,000 amid tariffs’ optimism

Gold nears $3,000 amid tariffs’ optimism

The intense march north in the Greenback, in combination with the marked rebound in US yields across the curve are prompting Gold prices to recede to the proximity of the critical $3,000 mark per troy ounce.

Gold News
Crypto morning: Bitcoin's bullish surge, Fidelity's Ethereum leap, Trump-backed WLF's $3M MNT buy

Crypto morning: Bitcoin's bullish surge, Fidelity's Ethereum leap, Trump-backed WLF's $3M MNT buy

Bitcoin traders are reacting positively to the US Federal Reserve’s (Fed) policy shift. As BTC hovers around the $88,000 level on Monday, analysts are optimistic about Bitcoin price gains this week. Technical analysis supports Bitcoin’s bullish thesis. 

Read more
Seven Fundamentals for the Week: Tariff news, fresh surveys, the Fed's preferred inflation gauge are eyed

Seven Fundamentals for the Week: Tariff news, fresh surveys, the Fed's preferred inflation gauge are eyed Premium

Reports and rumors ahead of Trump’s reciprocal tariffs announcement next week will continue moving markets. Business and consumer surveys will try to gauge where the US economy is heading. Core PCE, the Fed's preferred inflation gauge, is eyed late in the week.

Read more
The Best brokers to trade EUR/USD

The Best brokers to trade EUR/USD

SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.

Read More

Forex MAJORS

Cryptocurrencies

Signatures

Best Brokers of 2025