Silver (XAG) Forecast: Silver Bounces, But Traders Wait on Core PCE for Price Prediction Clarity

Silver Holds Firm Above Key Pivot as Gold Weakens, Dollar Slides

Silver prices ticked higher mid-session Thursday, finding support at $36.30 as traders assessed diverging signals from the broader metals complex and macro landscape. The market rebounded off Tuesday’s low at $35.28, stabilizing within a $2.04 trading range defined by $37.32 resistance and strong support from former tops at $35.40 to $34.87.

Gold Retreats on U.S. Inflation, Fed Tone Remains Restrictive

 

Gold lost ground after early-week gains, reversing below its 50-day moving average at $3325.10. The pullback followed a sharp 16.4% jump in U.S. durable goods orders—led by transportation—combined with sticky inflation data. PCE inflation rose 3.7% and core PCE edged up to 3.5%, tempering hopes for immediate Fed easing. Despite Q1 GDP contracting by 0.5%, the Federal Reserve’s tone remains cautious, with Chair Powell reiterating a wait-and-see approach. Market pricing suggests a high likelihood of a September cut, but inflation and real yields remain critical hurdles for bullion upside.

Dollar Index Slides to 2022 Lows on Fed Credibility Risks

The U.S. Dollar Index broke below key support at 97.621, slipping to its lowest level since early 2022. Political uncertainty—fueled by reports that President Trump may seek to replace Fed Chair Powell—has dented central bank credibility, accelerating the greenback’s decline.

The euro rallied to a 3-year high at $1.1708, while the dollar posted decade lows against the Swiss franc at 0.8007. With DXY now below its 50-day moving average of 99.400, bearish pressure remains intact, especially with Q1 economic contraction and surging insured unemployment weighing on sentiment.

What Does This Mean for Silver? Dollar Weakness a Key Tailwind

Silver’s firming tone reflects growing support from a weakening dollar and safe-haven demand shifting from gold. With gold slipping and the gold/silver ratio potentially adjusting, silver’s technical setup looks more constructive. A sustained move above $36.30 opens the door to retesting the multi-year high at $37.32. Failure to hold this level would expose the $35.40–$34.87 support range. Traders are watching momentum closely, especially as the metal diverges from gold’s softening tone.

Market Outlook: Bias Tilts Bullish While Above $36.30

Silver’s short-term outlook is constructive as long as the market remains above the $36.30 pivot. Strong dollar headwinds and equity-market strength have redirected capital flows, but silver’s resilience—despite gold’s softness—suggests underlying support. Unless gold breaks down sharply or the dollar stages a surprise rebound, silver bulls may target a retest of $37.32 in the near term.

More Information in our Economic Calendar.