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Commodities Silver

Silver Price Forecast: XAG/USD Falters Below $32.50 as US Yields Recover

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  • May 17, 2025
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Silver prices (XAG/USD) concluded the week with a negative bias, falling below $32.50 as US Treasury yields recovered, dampening demand for the metal. Though it consolidated between the 50-day SMA at $32.73 and 100-day SMA at $31.88, XAG/USD could not show a directional bias, and the RSI remained close to neutral. A conclusive break above $33.00 would steer momentum to the advantage of bulls towards $33.50 and possibly $34.51. But a decline below $32.00 would open up the way to lower support levels at $31.65 and the 200-day SMA at $31.23, elevating downside risk in the short term. KEY LOOKOUTS • A break above this level on a sustained basis could generate bullish momentum, paving the way to $33.50 and $34.51. • Holding above this psychological level is essential; a breakdown could fuel bearish pressure. • The 50-day SMA of $32.73 marks the top of the upside, while the 100-day SMA of $31.88 and 200-day SMA of $31.23 offer essential downside support. • The neutral RSI on the 50 level signifies indecision; a move either way could point to the next direction of the trend. Traders must keep a close eye on the $33.00 resistance level, as a break above it may ignite fresh bullish pressure, reaching $33.50 and possibly $34.51. Conversely, it is imperative to hold support at $32.00; a break would reveal important levels at $31.65 and the 200-day SMA at $31.23, indicating increasing bearish pressure. The 50-day and 100-day SMAs at $32.73 and $31.88 remain to establish the ongoing consolidation range. Meanwhile, the RSI close to neutral indicates market indecision, and a decisive directional move could be on the cards. XAG/USD is range-bound between the 50-day SMA at $32.73 and the 100-day SMA at $31.88, and there isn’t a definitive trend. A breach above $33.00 might initiate bullish momentum, while a fall below $32.00 could reveal lower support around $31.23. • XAG/USD languishes below $32.50 on pressure from surging US Treasury yields. •  Price capped by 50-day SMA at $32.73, supported by the 100-day SMA at $31.88. •  RSI is flat at the neutral 50 level, showing no clear direction in the market. •  Break above $33.00 might set the stage for moves to $33.50 and the October high of $34.51. •  Losing above $32.00 might take prices lower to $31.65 and the 200-day SMA of $31.23. • Choppy market conditions continue, with silver consolidating inside a tight band during the last week. • Technical bias still remains neutral, looking for a clear break above resistance or below important support. Silver prices eased at the end of the week, driven mainly by general market sentiment and macroeconomic conditions. The recent bounce in US Treasury yields depressed investors’ demand for non-yielding assets such as silver, helping push it into decline. In spite of persistent geopolitical tensions and inflation issues, the metal did not get any safe-haven flows, indicating market participants are more interested in interest rate directions and dollar moves at this point. XAU/USD DAILY PRICE CHART CHART SOURCE: TradingView Silver’s direction remains heavily influenced by global economic indicators and policy expectations. As market participants weigh future economic data and central bank cues, silver’s mood is still guarded. Although the metal has long-term appeal as an industrial and investment precious metal, short-term patterns are linked to moving macro dynamics and risk appetite in larger financial markets. TECHNICAL ANALYSIS Silver (XAG/USD) is in a consolidation mode, being stuck between the 50-day Simple Moving Average (SMA) of $32.73 and the 100-day SMA of $31.88. The Relative Strength Index (RSI) is steady around the neutral position of 50, indicating no momentum in either direction. A break above or below these major levels can determine the direction of the next trend with $33.00 serving as key resistance and $32.00 as near-term support. Without a breakout, price action can be directed to remain range-bound and choppy. FORECAST Silver (XAG/USD) breaking above the major resistance level of $33.00 may cause a bullish push towards the next targets at $33.50 and $34.00. A prolonged thrust past these levels can cause a test of the October 30 high of $34.51. The bearish momentum would probably be underpinned by new buying interest, particularly if overall market conditions, like softer US yields or a weaker dollar, become favorable to precious metals. Technical charts also may turn to signal bullish orientation, underpinning the rise. Conversely, a fall below the $32.00 level could indicate increasing bearish pressure, sending silver lower toward the 100-day SMA at $31.88 and May 15 low of $31.65. If this support level does not hold, the next significant level to watch would be the 200-day SMA at $31.23, with potential to slide further toward the $31.00 psychological level. Such action would signal a change of heart, perhaps on the back of firmer economic data or sustained advances in US Treasury yields, which have a tendency to weigh upon precious metals.

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Commodities Gold

Gold Prices Fall Below $2,910 on Increasing US Yields and Firm Job Growth

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  • March 8, 2025
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Gold prices declined below $2,910 as US Treasury yields bounced back after the release of the February Nonfarm Payrolls report, which revealed firm job growth though missing estimates. Federal Reserve officials, including Chair Jerome Powell, reaffirmed that the central bank is not in a hurry to cut interest rates, maintaining monetary policy intact for the time being. Although inflation is still a worry, Powell made it clear that the journey to 2% inflation will be rough. Central banks such as China’s PBoC and Poland’s NBP also continue to build up their gold reserves, giving some support to the metal. But increasing US real yields and declining geopolitical tensions capped gold’s upside potential. KEY LOOKOUTS • A US Treasury yield rebound can continue to put pressure on gold prices, particularly with increasing real yields affecting gold’s attractiveness. • The Fed’s reluctance to cut rates and Powell’s inflation remarks indicate that monetary policy will be tight, capping gold’s potential. • Softening geopolitical tensions, especially in Ukraine and Russia negotiations, may dampen gold’s safe-haven demand and pressure prices. • Continuous gold buying by large central banks such as China and Poland might offer price-supporting underlying fundamentals, counteracting general market pressure. Prices in gold are being pressured downwards by US Treasury yields recovering and real yields increasing, which has been historically inversely affecting gold’s attractiveness. The Federal Reserve remains cautious about rate cuts, with Chairman Jerome Powell emphasizing that achieving 2% inflation will be a “bumpy” process, suggesting that interest rates will stay steady for the time being. Easing geopolitical tensions, particularly in Ukraine and the Middle East, have also reduced the safe-haven demand for gold. But central banks, such as China’s PBoC and Poland’s NBP, keep on taking gold, which should lend some underlying support to the precious metal in spite of overall market difficulties. Gold prices are in pressure because US Treasury yields move higher and the Fed indicates a stable direction for interest rates. Although softening geopolitical tensions lower safe-haven demand, central bank buying, especially by China and Poland, lends some support to gold prices. • Gold drops below $2,910 as US Treasury yields recover, exerting downward pressure on the metal. • The February Nonfarm Payrolls report indicates consistent job growth, with 151K jobs created, though missing expectations. • Federal Reserve officials, including Jerome Powell, indicate no hurry to reduce rates, stressing the necessity of a cautious approach to inflation. • Powell reaffirms that the path to 2% inflation will be “bumpy,” maintaining monetary policy unchanged for the foreseeable future. • Ukraine-Russia progress and US pressure on Hamas lower gold’s safe-haven demand, capping gains for the metal. • The People’s Bank of China (PBoC) and Poland’s National Bank (NBP) have added gold reserves, with Poland purchasing the most since 2019. • US real yields, especially on 10-year TIPS, rise, presenting a headwind to gold prices by lowering its relative attractiveness. Gold prices are under pressure following increases in US Treasury yields and the Federal Reserve holding firm on interest rates. The latest US jobs report evidenced stable growth within the labor market with more joining the workforce while numbers fell short of expectations. Fed Chair Jerome Powell has indicated the central bank isn’t in any hurry to cut rates, given that the route to 2% inflation is uncertain and tough. This risk-averse policy stance has caused a more balanced economic outlook, taking away some of the gold’s attractiveness as a safe-haven asset. XAU/USD DAILY PRICE CHART CHART SOURCE: TradingView Concurrently, relaxing geopolitical tensions, especially between Russia and Ukraine, have reduced the need for gold as a safe haven from world uncertainties. Improvement in ceasefire negotiations, coupled with a reduction in tensions in the Middle East, has also dampened gold’s presence in investors’ portfolios. In the meantime, central banks such as China’s People’s Bank of China and Poland’s National Bank are still buying gold, offering some sustained support to the metal. These central bank interventions, together with a strengthening global economic outlook, could assist in stabilizing gold prices in the face of wider market pressures. TECHNICAL ANALYSIS Gold prices are met with resistance at the $2,930 level, with the Relative Strength Index (RSI) indicating that there is still room for additional upside. The metal has, however, been unable to climb above this mark, signifying a period of consolidation. A fall below the $2,900 level might indicate further downside risk, with the next significant support levels being the February 28 low of $2,832 and the $2,800 level. On the other hand, a break above $2,930 could pave the way for a possible rally towards $2,950 and even $3,000, if momentum keeps accelerating. The market is still in a tight consolidation, with the price action of gold very closely related to movements in US Treasury yields and general market sentiment. FORECAST If gold can break above the current levels of resistance, notably the $2,930 level, prices could have the potential to rise further. A sustained rally could have gold pushing through the $2,950 level, with a possibility of reaching the all-time high of $2,954. If momentum keeps gaining and overall market conditions are supportive, like further central bank gold buying and geopolitical tensions, the $3,000 mark could come into view. Also, if inflation remains in play or the Fed is signaling to postpone rate cuts, gold might attract even more strength as a hedge against economic uncertainty. On the negative side, if gold is unable to hold above the $2,900 level, further selling could be witnessed. A breakdown below this level would likely lead to a move towards the February 28 low of $2,832, followed by a possible test of the $2,800 support. Increasing real yields and a firmer US dollar can continue to depress gold, as it becomes less appealing relative to other assets. If the US economy continues to demonstrate strength, with the Fed still being aggressive on rates, gold may see further pressure, potentially pulling prices down in the near term.

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