Silver (XAG/USD) edged higher on Friday, trading around $58.60 and marking a 2.40% gain on the day, as a pullback in oil prices contributed to lower US Treasury yields while the US Dollar fluctuated near recent highs [1]. Despite this uptick, both oil prices and Treasury yields remain elevated, which continues to limit silver's upside potential. Persistent inflation concerns are reinforcing expectations for a hawkish Federal Reserve, with the CME FedWatch Tool indicating traders see an 80% chance of a rate hike in September, although the Fed is widely expected to keep rates unchanged at next week’s meeting [1].
Technically, silver has been consolidating between $55 and $63 since late June, signaling stabilization after a decline from May’s peak near $90.00 [1]. The metal is currently struggling to clear the 21-day Simple Moving Average (SMA) at $58.82, with the 50-day and 100-day SMAs at $65.44 and $71.21, respectively, maintaining the broader bearish structure [1]. Momentum indicators present a mixed outlook: the Relative Strength Index (RSI) is near 45, suggesting subdued momentum, while the MACD is slightly above zero, indicating moderate selling pressure. The Average Directional Index (ADX) near 36 points to a trend that retains meaningful strength [1].
On the downside, initial support is identified at $55, where buyers have previously entered the market. To the upside, bulls must reclaim the 21-day SMA at $58.82 to alleviate immediate downside pressure, with further resistance at $63 and the 50-day SMA at $65.44. Only a sustained break above these levels would challenge the prevailing bearish trend, with the 100-day SMA at $71.21 as the next major resistance [1].
No analyst opinions or forward-looking statements beyond the CME FedWatch Tool’s rate hike probabilities are provided in the article [1].
CONCLUSION
Silver is consolidating within a defined range, with technical resistance levels and hawkish Fed expectations capping upside momentum. Market sentiment remains cautious as traders await the upcoming Fed meeting, with the broader bearish structure intact unless key resistance levels are breached.