Silver Price Forecast: XAG lower highs structure holds, bears eye $55
- Silver preserves lower-high structure as bearish momentum accelerates.
- RSI turns lower below 50, signaling sellers retain control.
- Break below $54.77 exposes $50.00 and $48.64 supports.
Silver price dives over 3.80% on Thursday as the precious metals segment tumbles amid overall US Dollar strength and heightened risk aversion amid heightened tensions in the Middle East. The XAG/USD trades at $57.62 after hitting a weekly high of $60.94.
XAG/USD price forecast: Technical outlook
The white metal remains downwardly biased despite recovering some ground after bouncing off yearly lows of $54.77. The market structure of lower highs and lower lows remains intact, an indication that the downtrend might extend in the near term.
Momentum-wise, Silver remains bearish as the Relative Strength Index (RSI) reversed its course toward the 50-neutral level, aiming lower in bearish territory.
For a bearish continuation, sellers need to drive the price below the July 17 low at $54.77. Once hurdled, the next stop is the $50 milestone. On further weakness, the next area of interest would be the November 21, 2025 swing low of $48.64.
On the other hand, if buyers move in and drag Silver above the July 22 day’s high at $60.94, it opens the path toward challenging the July 6 high at $63.38. Above the next key resistance is the psychological $64.00, ahead of the 50-day SMA at $65.79.
XAG/USD daily price chart
Silver FAQs
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.
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.
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.
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
Christian Borjon Valencia
FXStreet
Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.
