Silver Price Forecast: XAG/USD Struggles to Rebound as Sellers Remain Active

Silver (XAG/USD) continues to face downside pressure in early Thursday trading after suffering a steep 2.7% drop during the previous session. Recovery attempts have been weak so far, as bearish sentiment lingers in the market.

Fed’s Hawkish Stance Boosts the Dollar, Weighs on Silver

The U.S. Dollar remains firm, supported by strong economic fundamentals. Recent GDP and labor market data have outperformed expectations, while hawkish comments from Federal Reserve Chair Jerome Powell have reinforced the Fed’s cautious stance on rate cuts. These developments have pushed U.S. Treasury yields higher and weakened demand for non-interest-bearing assets like silver.

As a result:

• Silver remains under pressure, hovering near a three-week low at $36.70
• Upside attempts are limited, with sellers capping gains around $37.30
• The price has broken below a key ascending trendline that started from April’s lows, signaling a bearish shift

Technical Outlook: Limited Recovery in Sight

From a technical perspective, the break below the trendline indicates that the bullish momentum that had built up since April is fading. The 4-hour RSI is in oversold territory, hinting at the possibility of a short-term bounce. However, in the current context, any rally is likely to encounter strong resistance.

Immediate resistance stands at $37.30. If buyers manage to push higher, the next levels to watch include $37.95, followed by the broken trendline now positioned near $38.80.

Support Levels to Watch on the Downside

To the downside, the first line of support lies at $36.80—Wednesday’s session low. A break below this level could see silver slipping further toward the July 9 low at $36.30, and then to the June 24 and 29 lows near $35.34.

Despite the downward pressure, the oversold technical indicators may limit further losses in the immediate term unless new bearish catalysts emerge.

Silver Price Cash Warning: Rate Signals Flash Red for Metal Traders

Conclusion:

Silver remains trapped in a bearish environment, driven by a strong U.S. Dollar and firm Treasury yields. Although the market is technically oversold, the recovery remains capped, and sellers are likely to dominate unless significant market shifts occur.

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