Silver Price Forecast: RSI turns oversold as XAG/USD sellers target $50.00

• Silver hits new yearly lows as hawkish Fed expectations weigh on prices.
• Trading below its daily SMAs, XAG/USD retains a bearish bias.
• Despite an oversold RSI reading, MACD and ADX indicate that sellers retain the upper hand.

A decline of around 3% on Thursday takes Silver (XAG/USD) to new year-to-date lows, with expectations of a hawkish Federal Reserve (Fed) deterring buyers. The metal is trading at around $52.32 at the time of writing, a level last seen in November 2025.

Even a weaker US Dollar (USD) has failed to halt the fall, indicating that interest rate expectations continue to dictate price movements. As borrowing costs rise, so does the opportunity cost of holding Silver, which offers no yield.

September’s core Personal Consumption Expenditures (PCE) Price Index rose 0.3% MoM, according to Thursday’s US economic releases, leaving expectations of a December rate increase firmly intact. The measure is closely monitored by the Fed. On an annual basis, core inflation climbed from 3.0% to 3.1%, still exceeding the Fed’s 2% target.

The preliminary third-quarter Gross Domestic Product (GDP) estimate also put annualised US growth at 3.4%, exceeding the 3.2% forecast and accelerating from the previous quarter’s 2.2%. According to the CME FedWatch Tool, traders assign around an 80% probability to a rate increase in December.

These figures follow the Fed’s decision on Wednesday to leave interest rates at 3.75%-4.00% as its October meeting concluded. The key message, however, was that inflation was still elevated and that the central bank remained committed to securing price stability.

Sellers Retain Control of Silver’s Technical Outlook

With XAG/USD well beneath its key daily moving averages, the technical picture continues to favour sellers. A Relative Strength Index (RSI) reading near 28 points to oversold conditions, potentially leaving scope for a short-term rebound. Against that, the Moving Average Convergence Divergence (MACD) is still negative, and an Average Directional Index (ADX) reading near 37 indicates that the downward trend remains strong.

Any recovery would first encounter horizontal resistance near $55.00, then the former consolidation area around $60.00. Beyond those levels, the 100-day SMA at $61.73 and the 50-day SMA at $62.11 form a broader resistance zone. Higher still, the 200-day SMA at $70.63 represents a substantial obstacle to a sustained recovery.

Should the slide continue, attention would turn to the psychological $50.00 level as key support. A clear break beneath that threshold could pave the way for further losses.

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