Silver Price Forecasts: XAG/USD struggles to regain the $75.00 area

Silver attempts to extend gains past $75.00 after bouncing from lows near $64.00.
The precious metal has dropped nearly 30% over the last two weeks.
XAG/USD technical picture remains bearish while below the $92.00 area.

Guillermo Alcala FXStreet

Silver (XAG/USD) is trimming some losses during Friday’s early European session, trading right above $74.00 at the time of writing, after hitting fresh seven-month lows near $64.00 earlier on the day. The pair, however, remains capped below a previous support area, in the vicinity of $75.00.

The white metal has dropped nearly 30% over the last two weeks, weighed down by investors' relief after US President Trump appointed Kevin Warsh as the replacement for Jerome Powell as the central bank’s chairman, and by easing geopolitical tensions, as the US and Iran opened negotiations to avoid a conflict.

Technical Analysis: XAG/USD remains bearish while below $92.00Chart Analysis XAG/USD

XAG/USD is picking up from lows, with the technical picture showing a bearish scenario. The 50-period Simple Moving Average (SMA), which acted as a dynamic support during the bullish cycle, extends its decline, with the pair holding beneath it. The Moving Average Convergence Divergence (MACD) line has slipped back below the zero line, and the Relative Strength Index (RSI) remains below 50, indicating weak traction.

Silver's recovery found resistance at the $75.00 area, which is holding bulls for now. Further up, the pair might find resistance at an intraday level around $81.00. Key resistance is at Wednesday's high in the area of $92.00.

Immediate support is at the daily low of $64.08, below that level, the $60.00 round level, and early December lows, in the $56.00 area, might come into focus

(The technical analysis of this story was written with the help of an AI tool.)

Silver FAQs

Why do people invest in Silver?

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.

Which factors influence Silver prices?

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.

How does industrial demand affect Silver 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.

How do Silver prices react to Gold’s moves?

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.

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