• Silver trades below 50-day SMA at $31.37; $30.84 support is key for preventing deeper pullback.
• Bearish momentum persists with RSI in seller’s territory, favoring near-term downside.
• A close above $31.50 needed for bullish recovery, targeting $31.75 and potentially $32.00.

Silver retreated from two-day highs of $32.00 and tumbled below the 50-day Simple Moving Average (SMA) at $31.37 late in the North American session. This was weighed down by a strong US Dollar underpinned by former President Donald Trump’s victory. At the time of writing, the XAG/USD trades at $31.29, down 2.29%.

XAG/USD Price Forecast: Technical outlook

Silver’s price uptrend remains in play despite posting solid losses. The fall of US Treasury yields kept the grey metal from falling further, but a decisive break below the November 6 low of $30.84 could exacerbate a deeper pullback. In that outcome, the next support would be the 100-day SMA at $30.27, followed by the September 5 high turned support at $29.17.

For a bullish resumption, the XAG/USD must close above the $31.50 area. This could pave the way to challenge the July 11 high at $31.75. A breach of the latter will expose $32.00, followed by May’s 20 peak at $32.51.

Momentum is bearish in the near term, as shown by the Relative Strength Index (RSI), breaching its neutral line into the seller’s area.

XAG/USD Price Chart – Daily

Support from 2.50 to 2.55

Near-term potential support is around 2.58 to 2.55, consisting of a prior interim high and the 20-Day MA, respectively. Also, a weekly low is at 2.51 along with the 50-Day MA at 2.53. So, in summary there is a potential support zone from 2.58 to 2.51, while a drop below this week’s low could lead to an even deeper pullback.

Formed an Inside Week

This week will end with an inside week for natural gas. Therefore, a potential weekly bullish breakout will be set up for next week. A rise above the week’s high of 2.82 will signal the breakout, while a drop through the low of 2.51 may lead to a deeper retracement.

Given the price structure for natural gas, the expectation is for an eventual upside breakout. One reason is that last week triggered a bullish weekly reversal from a retracement low. But this doesn’t mean the lower price won’t be tested before a bullish breakout. Nonetheless, the market will signal based on its reaction to price levels.

Signs of Strength Begin Above 2.75

Earlier signs of strength will first be indicated on a rise above today’s high of 2.75, and then each daily high for this week starting with Tuesday. Notice that there are four days in a row where the high price for the day was lower than the prior day. Nevertheless, a breakout above the weekly high, or swing high of the daily chart, will provide a more convincing bullish signal, that may subsequently lead to an upside breakout from a large symmetrical triangle pattern.

For a look at all of today’s economic events, check out our economic calendar.

• Silver price retreats from $32.30 as investors expect Trump’s protectionist policies could force the Fed to turn hawkish on interest rates.
• Fed Powell doesn’t see any near-term impact of Trump’s policies on the interest rate path.
• China’s economic package failed to impress market participants.

Silver price (XAG/USD) resumes its downside move after its recovery move met resistance near $32.20 in the North American session on Friday. The white metal falls back as traders assess the implications of Donald Trump’s victory in the United States (US) presidential elections on domestic and the global economy.

Donald Trump promised to raise tariffs by 10% universally, expecting China that could face duties rising as much as 60%. Higher tariffs on offering coming from the external economy would boost in house production and prompt labor demand, which will prompt inflationary pressures. This will force the Federal Reserve (Fed) to opt for a hawkish interest rate stance.

However, Fed Chair Jerome Powell doesn’t see any immediate impact of Trump’s victory on the monetary policy action in the upcoming meetings after the bank cut interest rates by 25 basis points (bps) to 4.50%-4.75% on Thursday.

Meanwhile, some recovery in the US Dollar after Thursday’s correction has also weighed on the Silver price. The US Dollar Index (DXY), which gauges Greenback’s value against six major currencies, jumps to nearly 106.40.

Apart from expectations for the Fed turning hawkish, an absence of meaningful economic stimulus by China has also weighed on the Silver price. In Friday’s late Asian session, China announced a massive 10 trillion yuan program to refinance local government debt with approval by the National People’s Congress. Market experts see the stimulus package as a measure against Trump’s potential tariffs, however, they consider it as insufficient to fix the likely impact on their economic growth.

Economists at Standard Chartered Plc expect “China’s growth would suffer a hit of as much as two percentage points should Trump follow through on his campaign vow to raise tariffs on Chinese goods to 60%.”

Silver as a metal has applications in various industries such as solar energy, mining, and power and signs of weak China growth prospects impact the Silver price.

Silver technical analysis

Silver price slides to near $31.00 after breaking below the horizontal support plotted from the May 21 high of $32.50. The near-term trend of the Silver price has turned bearish as it has dropped below the 50-day Exponential Moving Average (EMA), which trades around $31.60.

The asset could find support near the upward-sloping trendline around $29.00, plotted from the February 28 low of $22.30.

The 14-day Relative Strength Index (RSI) dives to near 40.00. Should RSI (14) falls below 40.00, a bearish momentum will be triggered.

Silver daily chart

• Silver struggles to capitalize on the previous day’s goodish rebound from a three-week low.
• The technical setup favors bears and supports prospects for a further near-term downfall.
• A sustained strength above the $32.30-$32.35 area is needed to negate the negative bias.

Silver (XAG/USD) meets with a fresh supply on Friday and reverses a major part of the previous day’s goodish recovery move from over a three-week low. The white metal continues losing ground through the first half of the European session and touches a fresh daily low, around the $31.30 area in the last hour.

From a technical perspective, any further decline is likely to find some support near the $31.00 mark ahead of the $30.85-$30.80 region, or the multi-week low. Some follow-through selling below the 50% Fibonacci retracement level of the August-October rally, around the $30.65-$30.60 area, will be seen as a fresh trigger for bearish traders. 

Given that oscillators on the daily chart have just started gaining negative traction, the subsequent fall could drag the XAG/USD below the 100-day Simple Moving Average (SMA), currently pegged around the $30.25 area, towards the $30.00 psychological mark. The downward trajectory could extend to the 61.8% Fibo. level, near the $29.65 region.

On the flip side, the $32.00 round figure now seems to have emerged as an immediate strong hurdle. This is followed by a hurdle near the $32.30-$32.35 horizontal zone, which if cleared decisively might trigger a short-covering move to the $33.00 mark before the XAG/USD extends the positive momentum towards the next relevant barrier near the mid-$33.00s.

Silver daily chart

Created on November 08, 2024

• The West Texas Intermediate crude oil market has bounced around during the trading session on Thursday as we wait for the FOMC meeting but there are a lot of technical things going on at the same time.
• The market is currently hanging around the 50 day EMA which is a large indicator that a lot of people pay close attention to.
• The $72.50 level above is a significant resistance barrier.

If we can break above that, then I think it opens up the possibility of a move toward the 200-day EMA, which is attractive to a lot of traders. And that happens to be near the crucial $75 region. If we pull back from here, the $70 level could be a major support level as we’ve seen a couple of times here recently, but even if we break down below that, then you’re looking at $67.50 level as a potential floor as well.

In general, this is a market that I think continues to see a lot of choppiness and indecision, and there are a lot of things going on to cause that. After all, we have seen the $65 level underneath is a massive floor in the market over the last couple of years.

The USA is About to Make Its Prescence Known

Regardless, this is a situation where the United States will be a major influence on the oil market going forward now that Donald Trump has been elected. One of his biggest platforms is to continue to drill and make not only the United States, energy independent, but energy dominant. For example, there are places in United States territory such as the Anwar, which is a preserve in Alaska, but if they tap that, it has more oil than Saudi Arabia. There is a high probability that the Americans will start drilling in places like that again, and if they do, it will put a bit of a ceiling on the market. That being said, that is several months out, maybe even a couple of years, but that will be an overhang in the market. So, I think we go sideways, possibly as high as the 200 day EMA, but breaking above there, I think is going to take some type of event. We’ll have to wait and see.

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• Silver price loses ground as higher US Treasury yields increase the opportunity cost of holding precious metals.
• The demand for dollar-denominated Silver struggles due to the improved US Dollar.
• Non-interest-bearing Silver received support on Thursday after the Fed announced a 25 basis point rate cut.

Silver price (XAG/USD) loses ground to near $31.70 per troy ounce during the Asian hours on Friday. A modest rise in US Treasury yields is adding downward pressure on non-yielding assets like Silver, as higher yields increase the opportunity cost of holding precious metals. At the time of writing, the 2-year and 10-year US Treasury bond yields stand at 4.20% and 4.33%, respectively.

Additionally, the demand for dollar-denominated Silver struggles, as a stronger US Dollar (USD) makes the precious metal more expensive for buyers using foreign currencies. The US Dollar Index (DXY), which measures the value of the US Dollar against the other six major currencies, advances to near 104.50 at the time of writing.

Traders expect potential stimulus measures from China as the National People’s Congress Standing Committee concluded its five-day meeting. Earlier this week, media reports suggested that the potential stimulus package could exceed 10 trillion yuan. As one of the world’s largest manufacturing hubs for electronics, solar panels, and automotive components, China may have increased demand for Silver.

However, prices of the non-interest-bearing Silver gained ground following the Federal Reserve’s recent rate cut. The Federal Open Market Committee (FOMC) lowered its benchmark overnight borrowing rate by 25 basis points (bps) to a target range of 4.50%-4.75% at its November meeting on Thursday.

Moreover, Federal Reserve Chair Jerome Powell indicated that the central bank is proceeding with interest rate cuts, given the ongoing tightness of monetary policy. Investors are now anticipating the release of the preliminary US Michigan Consumer Sentiment, which is expected later on Friday.

• Gold sellers continue to lurk above $2,700 early Friday ahead of UoM Consumer Sentiment data.
• The US Dollar pauses decline with Treasury bond yields, as traders digest the Trump win and Fed rate cut.
• Gold price remains stuck between two key Fibo levels and daily averages amid a neutral daily RSI.

Gold price has returned to the red early Thursday after reversing more than half of the Trump win-led 3% slide on Wednesday. Gold sellers fight back control, as the US Dollar (USD) finds its feet amid a pause in the US Treasury bond yields sell-off while awaiting the Michigan preliminary Consumer Sentiment data.

Gold price appears divided between the Trump win and Fed rate cut

Gold is consolidating at around $2,700 in Asian trading on Friday, as investors catch a breather and take account of the volatile trading witnessed over the last two days.

Republican candidate Donald Trump’s second term as the US president, following an outstanding win in the election, spelt doom for the bright metal on Wednesday before being rescued by the US Federal Reserve (Fed) Chairman Jerome Powell after the two-day monetary policy meeting concluded on Thursday.

Markets digested the Trump presidency, believing that his policies on immigration, tax cuts and tariffs would put upward pressure on inflation, prompted a fresh run higher in the USD, US Treasury bond yields and global stocks at the expense of the yieldless Gold price on Wednesday.

On Thursday, Gold price jumped back on the bids, as traders took profits off their USD longs ahead of the Fed interest rate decision. The Gold price rebound extended into American trading after the Greenback witnessed a fresh leg down following the Fed policy announcements.

The USD attempted a bounce in a knee-jerk reaction to the Fed’s rate decision, which was quickly reversed on Chairman Powell’s press conference. Powell noted that the Fed remains on a gradual easing path and that the election won’t have any near-term effect on the policy decision. He added that he will not quit even if asked by Trump.

Powell’s commitment to the Fed’s easing cycle was enough to trigger a fresh sell-off in the US Dollar across the board, providing extra legs to the Gold price recovery.  

The US central bank reduced the fed funds rate by 25 basis points (bps) to a range of 4.50% to 4.75%, as expected.

However, the Trump trades optimism remains well in place, as the Fed verdict is now out of the way, reviving the US Dollar’s bullish undertone while acting as a headwind for the Gold price.

The top-tier US consumer sentiment and inflation expectations data will also play its part in influencing the value of the USD and the Gold price in the session ahead, as traders may resort to positioning readjustments following a crucial week for markets while bracing for the US Consumer Price Index (CPI) data due next week.

The end-of-the-week flows could also infuse some volatility around the Gold price.

Gold price technical analysis: Daily chart

As observed on the daily chart, Gold price bounced off the important support at $2,641, which is the confluence of the 50-day Simple Moving Average (SMA) and the 78.6% Fibo level of the latest record rally from the October 10 low of $2,604 to the new all-time high of $2,790.

Defending that level triggered a fresh upswing, where buyers challenged the 21-day SMA, then at $2,712.

At the moment, Gold price remains stuck between the confluence resistance of the 21-day SMA and the 38.2% Fibo level at $2,718 while holding well above the aforesaid strong cushion at $2,641.

The 14-day Relative Strength Index (RSI) is flatlining at the 50 level, suggesting a lack of a clear directional bias for Gold price.

If the renewed weakness extends below the 50% Fibo support at $2,695, a fresh leg lower toward the 61.8% Fibo level of $2,673 will be in the offing.

Further down, the $2,641 confluence support will come into play once again.

On the flip side, Gold buyers need acceptance above the healthy resistance at $2,718 to initiate a fresh uptrend toward the previous static resistance near $2,745, where the 23.6% Fibo aligns.

The next relevant bullish target is seen at around the $2,760 round level en route to the record high of $2,790.