Silver (XAG) Forecast: Silver Market Braces for Powell—Market Flat Above $37.87 Pivot

Silver Hovers Above $37.87 into the Close as Fed, Yields and Dollar Keep Bulls in Check

Silver is flat late Monday, holding just above the key $37.87 pivot level that marks the 50% retracement of the recent rally. The market is coiled ahead of major policy signals from the Federal Reserve, with traders cautious despite a slight edge over this technical level. Gold is also holding near resistance at its 50-day moving average, highlighting the broader hesitation across metals.

At 16:34 GMT, XAG/USD is trading $38.01, flat for the session.

Momentum remains tentative as traders weigh interest rate expectations, dollar strength, and whether the Fed will provide the spark needed to sustain a breakout.

Fed’s Jackson Hole Speech Is the Market’s Trigger

Markets are waiting on the July FOMC minutes due Wednesday and Powell’s appearance Friday at Jackson Hole. Fed fund futures are pricing an 85% chance of a 25 basis point rate cut in September. However, the recent upside surprise in producer prices has injected uncertainty over the size and timing of any cuts.

Powell is unlikely to lock in a rate path without August jobs data, but any dovish shift would likely support a rally in silver. Until then, traders are managing exposure into the event risk.

Dollar Firm as Real Yields Remain Elevated

Silver’s upside is still constrained by the firm dollar and sticky real yields. Treasury yields are holding elevated levels—10-year near 4.345%, 2-year at 3.773%—which in turn are propping up the dollar.

Higher real yields increase the opportunity cost of holding silver and limit demand from overseas buyers. Unless yields start to back off, upside follow-through will depend heavily on a shift in Fed tone later this week.

Above $37.87, But Can It Hold?

Silver is now trading slightly above the 50% retracement at $37.87. If bulls can maintain control here, momentum could carry the market toward last week’s high at $38.74, followed by the long-term resistance at $39.53.

On the downside, if price slips back below $37.87, the next level to watch is the 50-day moving average at $37.30. A breakdown there exposes $36.21.

Outlook: Holding Pattern Above Key Support, Breakout Still in Play

Silver heads into Tuesday above a key technical pivot but still searching for direction. Fed commentary later this week will likely dictate the next move.

A dovish Powell could clear the path to $39+. If not, watch for renewed pressure below $37.30.

More Information in our Economic Calendar.