Silver Price Forecast: Will XAG/USD’s bearish bias persist below $55.00 as traders await FOMC?

Silver remains under pressure, unable to extend the previous day’s notable rebound from its YTD low.
With traders awaiting the FOMC policy announcement, the market lacks a meaningful fresh catalyst.
Downside risks continue to dominate, according to the technical setup.

Renewed selling pressure is weighing on Silver (XAG/USD) ahead of the outcome of the two-day FOMC meeting. Sellers emerged near $54.60 on Wednesday, halting the previous day’s recovery from the $52.70-$52.65 zone, its lowest level since November 2025. During the early European session, the white metal continues to trade below $54.00, holding on to its intraday losses.

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

An unchanged interest rate decision is widely anticipated when the US Federal Reserve (Fed) announces its policy later in the US session. For clues to the future policy path, traders will therefore focus on the accompanying statement and Fed Chair Kevin Warsh’s remarks at the post-meeting press conference. Any guidance on the outlook will influence the US Dollar (USD), offering XAG/USD a fresh catalyst before Thursday’s key US economic releases: the Advance Q3 GDP report and the Personal Consumption Expenditures (PCE) Price Index.

After the recent break below strong horizontal support around the psychological $55.00 level, this week’s back-and-forth trading could represent bearish consolidation. That former support should now serve as a strong immediate resistance. There are tentative signs of improving momentum: the Moving Average Convergence Divergence (MACD) indicator is turning positive above the zero line, signalling emerging but fragile upside momentum. Although the Relative Strength Index (RSI) has recovered from oversold territory, it remains below 50, suggesting that gains are still constrained.

Could a sustained move above $55.00 change the near-term picture? Such a break could prompt aggressive short covering, pushing XAG/USD past $56.00 towards the intermediate resistance at $56.40, followed by $57.00 and the 100-period Simple Moving Average (SMA) on the 4-hour chart. Positioned at $57.55, that moving average must be reclaimed by bulls to reduce the broader downward pressure and pave the way for a more sustained recovery. Until XAG/USD moves above this key $57.55 barrier, however, it remains exposed to further losses.

For bears, further weakness below $53.50 may be needed before positioning for a decline towards $53.00. A break beneath that level would bring Tuesday’s year-to-date low in the $52.70-$52.65 region back into view.

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

What does the XAG/USD 4-hour chart show?

Silver: Common Questions

What attracts investors to Silver?

Portfolio diversification, intrinsic value and a potential hedge against high inflation are among the reasons traders may choose Silver, even though it is less popular than Gold. This actively traded precious metal has long served as both a store of value and a medium of exchange. Investors can acquire physical Silver as coins or bars, or gain exposure through instruments such as Exchange Traded Funds that track its price in international markets.

What drives movements in Silver prices?

Several influences shape Silver prices, including interest rates, currency movements and demand for safe-haven assets. As Silver offers no yield, lower interest rates generally support its price. Geopolitical uncertainty or concerns about a deep recession can also lift prices through safe-haven demand, though this effect is less pronounced than for Gold. Since Silver is quoted in dollars (XAG/USD), the US Dollar’s (USD) performance matters too: dollar strength typically restrains prices, while weakness is likely to lift them. Investment demand, recycling rates and mining supply also influence prices, with Silver far more abundant than Gold.

Why does industrial demand matter for Silver prices?

Industrial demand can lift Silver prices when it rises sharply, while a decline usually weighs on them. Silver’s extensive industrial applications, particularly in electronics and solar energy, reflect its electrical conductivity, which ranks among the highest of all metals and exceeds that of Copper and Gold. Economic developments in the US, China and India can also cause price fluctuations. Large industrial sectors in the US and especially China consume Silver across a range of processes, while Indian consumers’ demand for Silver jewellery is another important influence on prices.

How closely does Silver track Gold prices?

Gold and Silver share similar safe-haven characteristics, so Silver generally tracks Gold’s price movements and typically advances when Gold rises. To assess their relative valuations, investors may use 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 overvalued. Conversely, a low ratio could indicate that Gold is undervalued compared with Silver.