The price of silver (XAG/USD) remains conservatively around $80 during the Asian trading session at the start of the week, slightly above the latest four-week low of $73.33 posted on Friday. The white metal is struggling to recover from last week’s chaos in which it lost more than 30% of its value from all-time highs of $121.66, triggered by a forceful US dollar (USD), profit booking after a forceful rally and expectations of a hawkish monetary policy outlook from the Federal Reserve (Fed).
Technically, the higher US dollar makes the silver price an unfavorable choice for investors in terms of risk and reward.
At the time of writing, the US Dollar Index (DXY), which tracks the value of the dollar against six major currencies, is holding firmly near its weekly high of 97.33.
On Friday, the dollar became the subject of significant bids after the White House nominated former Federal Reserve (Fed) Governor Kevin Warsh to succeed current Chairman Jerome Powell. Market experts believe that Warsh’s election will not weaken the Fed’s independence, which was highly expected after US President Donald Trump’s repeated statements that the up-to-date president would ensure further interest rate cuts.
Newly appointed Fed Chairman Kevin Warsh is known for supporting a forceful US dollar during his previous job at the US central bank, indicating that monetary conditions may remain tight in the future.
This week, investors’ attention will focus on non-farm payrolls (NFP) data in the US for January, which will influence market expectations regarding the prospects for the Fed’s monetary policy.
Silver technical analysis
On the daily chart, the XAG/USD rate is USD 81.38. The price remains above the rising 50-day EMA at $79.50, maintaining the medium-term uptrend. The boost in the average trend confirms the broader deviation. An RSI of 44 (neutral) reflects cooling momentum after the overbought period. A sustained stay above average could keep buyers engaged, while a close below average could reveal declines.
With price anchored above the 50-day EMA, a pullback would meet initial demand near animated support. RSI below 50 cap up in near future; reflection through the center line would improve the impulse. If momentum stabilizes, bulls may try to extend the recovery, and failure to reaccelerate will limit trading.
(The technical analysis for this story was written with the aid of an AI tool.)
Silver FAQs
Silver is a precious metal that investors willingly trade. Historically, it has been used as a store of value and a medium of exchange. Although less popular than gold, investors may turn to silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during periods of high inflation. Investors can buy physical silver in coins or bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can fluctuate due to many factors. Geopolitical instability or fear of a deep recession may push silver prices higher due to its safe-haven status, although to a lesser extent than gold. As a non-yielding asset, silver tends to rise at lower interest rates. Its movements also depend on the behavior of the US dollar (USD) when the asset is priced in dollars (XAG/USD). A forceful dollar tends to keep the price of silver at bay, while a weaker dollar will likely push prices higher. Other factors such as investment demand, mining supply – there is much more silver than gold – and recycling rates can also influence prices.
Silver is widely used in industry, especially in sectors such as electronics and solar energy, because it has one of the highest electrical conductivities of all metals – greater than copper and gold. An boost in demand can boost prices, while a decrease usually lowers them. The dynamics of the economies of the United States, China and India can also contribute to price fluctuations: in the case of the United States and especially China, enormous industrial sectors exploit silver in various processes; in India, consumer demand for precious metals for jewelry production also plays a key role in pricing.
Silver prices usually follow the movements of gold. When gold prices rise, silver tends to follow suit because their status as safe-haven assets is similar. The gold-to-silver ratio, which shows the number of ounces of silver needed to equal the value of one ounce of gold, can aid determine the relative valuation of the two metals. Some investors may view a high ratio as an indicator that silver is undervalued or gold is overvalued. On the contrary, a low ratio may suggest that gold is undervalued relative to silver.
