Silver (XAG) Forecast: Price Prediction Eyes $44.22 as Bullish Momentum Builds

Silver Eyes Multi-Year High as Fed Rate Bets Drive Precious Metals Rally

Silver futures surged on Friday, closing the week with a strong upside push that puts the metal within striking distance of a multi-year high. The rally aligns with renewed bullish momentum across the precious metals complex, supported by rising expectations of a Federal Reserve rate cut and broader investor appetite for inflation hedges.

At 20:43 GMT, XAG/USD is trading $42.27, up $0.71 or +1.70%.

Fed Rate Cut Bets Lift Entire Precious Metals Complex

The precious metals market is drawing support from mounting speculation that the Federal Reserve will cut interest rates at its upcoming September 17 meeting. Fed funds futures are fully pricing in a 25-basis-point cut, fueled by weak labor market data including a spike in jobless claims, downward payroll revisions totaling 911,000 jobs, and softer monthly hiring figures.

While August’s consumer price index came in slightly hotter than expected, the labor market’s deterioration is weighing heavier on rate expectations. This has pressured real yields and boosted non-yielding assets like gold and silver, both of which are responding to the increasingly dovish macro backdrop.

Silver Breaks Out—Is $44.22 the Next Test?

Silver spiked to a new yearly high at $42.46 on Friday, with technical momentum pointing to a possible retest of the multi-year resistance at $44.22. The bullish action is being driven by strong follow-through buying and spillover support from gold, which notched an all-time high of $3674.70 earlier in the week.

On the downside, initial support lies at $40.73 and $40.40. A break below these levels would shift short-term momentum lower and could expose the 50-day moving average at $38.70—currently serving as a key trend indicator.

Gold ETF Inflows and Central Bank Moves Underpin Outlook

Gold’s 1.7% weekly gain, its fourth consecutive, has lifted its year-to-date return to 39%. Renewed institutional interest is showing up in exchange-traded fund inflows, while UBS has raised its price target to $3,900 per ounce. Central bank demand remains a wildcard, with China considering reforms that could increase gold import volumes—potentially bullish for the broader precious metals market.

These trends also benefit silver, which often moves in tandem with gold but offers more volatility and higher leverage for traders.

Silver Forecast: Momentum Favors Retest of $44.22

With bullish momentum intact and support levels clearly defined, silver appears poised to retest the $44.22 resistance. The market remains sensitive to any surprise from the Fed next week, but barring a hawkish shift, the technical and fundamental backdrop supports further upside. Traders should watch $42.46 for a clean breakout confirmation and $40.40 as a key downside pivot.

More Information in our Economic Calendar.