Silver Price Forecast: Is $57 at risk after the rebound fails?

Selling pressure pulls XAG/USD back from $58.18, with buyers unable to set higher highs.
Directional momentum weakens as the RSI flattens while remaining bearish.
A move below $56.38 would put $55.00 in focus, with $50.00 potentially the next target.

Silver came under pressure as a firmer US Dollar, supported by rising US Treasury yields, pushed the metal below $58.00 following a daily high of $58.18. XAG/USD is trading 0.20% lower at $57.87 per troy ounce.

XAG/USD Price Forecast: Can Silver Reverse Its Downtrend?

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Silver’s fall below $60.00 has reinforced the downward trend. Despite advancing on two of the last three days this week, XAG/USD has not managed a higher high, suggesting that buying strength is fading as sellers step in.

Although the Relative Strength Index (RSI) remains bearish, it has levelled off. The momentum reading therefore indicates that neither side has control.

A break below the 20 October low of $56.38 is needed for XAG/USD to extend its decline. That would bring the psychological $55.00 level into view, with the $50.00 milestone further below.

A move above $60.00, by contrast, is required for buyers to reverse Silver’s trend. Clearing this barrier would open the way towards $61.01, the 23 March low that has become resistance. Beyond it lie the 100-day Simple Moving Average (SMA) at $62.56 and the 50-day SMA at $63.51.

XAG/USD Daily Price Chart

Silver: Frequently Asked Questions

What attracts investors to Silver?

Widely traded by investors, Silver is a precious metal with a long history as both a store of value and a means of exchange. Gold is more popular, but traders may choose Silver for its intrinsic value, to diversify their portfolios or as a possible hedge when inflation is high. Investors can purchase the physical metal as coins or bars. Alternatively, they can gain exposure through instruments such as Exchange Traded Funds that follow Silver’s price in international markets.

What drives movements in Silver prices?

A broad set of influences can drive Silver prices. Its safe-haven appeal may lift prices during geopolitical turmoil or concerns over a severe recession, though this effect is less pronounced than for Gold. Lower interest rates generally support Silver because it provides no yield. The US Dollar (USD) is another key influence: Silver is quoted in dollars (XAG/USD), so a stronger Dollar tends to restrain prices, while a weaker currency is likely to lift them. Investment demand, recycling rates and mine supply also matter, with Silver far more abundant than Gold.

Why does industrial demand matter for Silver prices?

With electrical conductivity among the highest of any metal, exceeding that of Copper and Gold, Silver has extensive industrial applications, especially in electronics and solar energy. A sharp increase in demand can push prices higher, whereas weaker demand tends to bring them down. Developments in the US, Chinese and Indian economies can also drive price fluctuations. Large industrial sectors in the US, and particularly China, use Silver across various processes. In India, consumer demand for Silver jewellery is also an important influence on prices.

How do Gold price movements influence Silver?

Given their similar safe-haven status, Silver generally tracks Gold and usually gains when Gold prices rise. Their relative valuations may be assessed using the Gold/Silver ratio, which measures how many ounces of Silver equal the value of one ounce of Gold. A high ratio may be interpreted by some investors as a sign that Silver is undervalued or Gold is overvalued. Conversely, a low reading might indicate that Gold is undervalued compared with Silver.