Silver Price Forecasts: XAG/USD resistance around $75.00 is testing bullish momentum
- Silver recovery stalls below $75.00 with bullish momentum intact.
- Hopes of a quick end to the Iran war have sent the US Dollar lower.
- XAG/USD looks ready to resume its recovery towards the $83.00 area.
Silver (XAG/USD) recovery has stalled below the $75.00 resistance area on Wednesday, yet the immediate upside bias remains intact after three consecutive trading days of gains. Downside attempts remain contained above $74.00 with precious metals favoured by a cautious risk appetite amid growing hopes of a swift end to the war in Iran.
US President Donald Trump boosted market sentiment on Tuesday, affirming that he expected the war to end in two or three weeks, no matter if a deal with Iran was reached or not, and that the Strait of Hormuz would open “automatically” after the US exit. The US Dollar Index has dropped nearly 1% following these comments, providing a significant boost to precious metals.
Technical Analysis: Indicators hint to a deeper recovery
The 4-hour chart shows the XAG/USD pair trading at $75.11 amid a mildly bullish near-term bias. The Relative Strength Index (RSI) at 62.25 shows a firm upside momentum, while the Moving Average Convergence Divergence (MACD) line remains above the signal line, and the histogram is at positive levels, highlighting persistent buying pressure.
Bulls are struggling to break resistance at the $75.30 area, but the positive indicators point to further recovery. Recent price action suggests that the pair is in the C-D leg of a Gartley pattern, aiming towards the $80.00 psychological level, and the area between mid-March highs, at the $82.60 area, and the 61.8% Fibonacci retracement level, at $83.35
Downside attempts remain contained above the $74.00 area for now, but the key support area is the March 26 low, at $66.71. A confirmation below that level invalidates this view and brings the March 23 low, at the $61.00 area, back into focus.
(The technical analysis of this story was written with the help of an AI tool.)
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
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
