Silver (XAG) Forecast: Bearish Outlook Builds with Silver Dropping Toward 50-Day MA

Silver Nears 50‑Day Average With Bulls on the Defensive

Spot silver (XAG/USD) retreated on Tuesday, drawing closer to a critical technical level at $45.79, the 50-day moving average. This threshold has not been tested since mid-August, when silver was trading under $37.00 — a level that ultimately sparked the rally toward May’s peak at $54.49.

A firm break below $45.79 would weaken the bullish structure and open the door to a deeper correction toward former highs at $44.22 and the longer-term 50% retracement level at $41.40.

At 15:20 GMT, XAG/USD is trading $47.17, down $0.91 or -1.90%.

On the upside, minor resistance sits at $49.38 and $49.46, with more meaningful resistance ahead in the $50.02 to $51.07 zone, marking the 50% to 61.8% retracement of the recent rally. Price action near $45.79 remains the immediate pivot for short-term direction.

Dollar Firms as Fed Cut Expectations Ease

The U.S. dollar index broke above 100 for the first time since early August, supported by reduced expectations for a December rate cut. Chair Jerome Powell emphasized that last week’s quarter-point rate cut may be the final move for the year, driving a re-pricing in FedWatch futures. Odds of a December cut fell to 65%, down from 94% a week earlier.

Dollar strength weighed broadly on precious metals, with gold slipping below $4,000 and silver trending lower. Safe-haven demand for the dollar, yen, and Swiss franc also rose as risk sentiment soured, driven by weak manufacturing data and ongoing economic uncertainty caused by the U.S. government shutdown.

Investor Uncertainty Deepens Amid Data Delays

The lack of key U.S. economic data — including the JOLTS report and October’s jobs numbers — due to the prolonged government shutdown has complicated the outlook. Traders are increasingly relying on alternative indicators such as the ADP private payrolls report and ISM data, which showed continued weakness in U.S. manufacturing.

Treasury yields slipped modestly across the curve, reflecting investor caution. The 10-year yield fell to 4.089%, while the 2-year yield declined to 3.578%, reinforcing defensive positioning ahead of additional Fed commentary.

Short-Term Outlook: Bearish Bias for Silver

With silver slipping toward $45.79 and the broader market turning defensive, the near-term bias for XAG/USD is bearish. A failure to hold above this level would likely invite further selling toward $44.22 or even $41.40.

Dollar strength, risk-off sentiment, and fading expectations for another Fed cut continue to pressure silver, at least until clarity returns on U.S. economic conditions or monetary policy direction.

More Information in our Economic Calendar.