Silver rises sharply as US yields decline, dovish Fed bets grow

Silver (XAG/USD) moves strongly higher this Wednesday, trading around $52.45 at the time of writing, up 2.00% on the day. The white metal extends its bullish momentum, supported by the continued decline in US yields and a shift in investor positioning toward non-interest-bearing assets, amid an increasingly accommodative outlook from the Federal Reserve (Fed).

Market conditions remain defined by persistent downward pressure on US rates, as Fed expectations turn more dovish. Recent comments from New York Fed President John Williams, emphasizing the need for further monetary adjustment, have strengthened expectations of a rate cut as early as the December meeting.

According to the CME FedWatch tool, markets now assign a very high chance to a 25-basis-point reduction, reinforcing the view that the Fed is moving toward a more accommodative stance, historically a supportive factor for Silver, which offers no yield.

The emergence of Kevin Hassett, White House economic adviser, as the leading candidate to replace Jerome Powell as Fed Chair, adds to this dovish perception. Investors believe that a Fed leader appointed by the Trump administration could favor a faster monetary easing cycle, especially amid slowing economic momentum.

Silver also benefits from renewed safe-haven flows, driven by international uncertainty and softer US economic signals. Recent weaker data, including slowing consumer spending and moderating producer prices, reinforce the sense that the US economic engine is losing traction. As a result, investors are increasingly turning toward precious metals as protection against macroeconomic risks and market volatility.

At the same time, the broad weakening of the US Dollar (USD), pressured by falling yields and rate-cut expectations, mechanically supports XAG/USD by lowering the cost for international buyers.

In this environment, where the Fed appears to be shifting toward additional easing and uncertainty remains elevated, Silver retains a solid bullish bias. The resilience of Gold further reinforces the broader market sentiment in favor of precious metals.

Silver Technical Analysis

In the 4-hour chart, XAG/USD trades at $52.63, above the day's opening price by $0.63, up for the day. The 100-period Simple Moving Average (SMA) rises to $50.47. Price holds above it, reinforcing a bullish bias. The Relative Strength Index (RSI) stands at 68, near overbought, which could cap initial gains. The rising trend line from $48.64 underpins the move, with support near $51.87. Immediate resistance aligns at $52.78.

Momentum remains firm while the pair holds above trend support, and a break higher would open the path toward $54.39. Support is seen first at $51.87, then at $48.64. With RSI elevated but still below 70, dips could stay contained above the rising line, and the advance would extend if buyers press through successive resistance.

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