Silver Price Forecast: XAG/USD falls below $51.50 as key US economic data loom

• Ahead of the data releases, changes in interest rate expectations and the broader direction of the US Dollar continue to influence silver prices.
• Forthcoming US weekly jobless claims, existing home sales and producer inflation data are becoming the focus for traders.
• The next economic releases are expected to offer crucial guidance on the path of Federal Reserve monetary policy.

At around $51.40 per troy ounce during Thursday’s European trading hours, silver (XAG/USD) is retreating following modest gains the previous day. A firmer US Dollar (USD) is putting pressure on the dollar-denominated precious metal.

Stronger-than-expected US Consumer Price Index (CPI) inflation figures have encouraged a more hawkish view of the Federal Reserve’s (Fed) policy outlook, helping the US currency maintain its strength.

Earlier this week, Fed Governor Christopher Waller said he would back a quarter-point increase, or even a half-point rise should inflation worsen. Traders have since increased their bets on a December rate rise, with the CME FedWatch Tool indicating that markets now assign it a probability of nearly 91%.

For further indications of the Federal Reserve’s monetary policy path, market participants are turning to the forthcoming US data calendar. Weekly jobless claims, existing home sales and producer inflation figures are among the key releases in focus.

Technical Analysis: Silver Remains Under Pressure

Trading at $51.40 on the daily chart, XAG/USD remains beneath both its nine-period and 50-period Exponential Moving Averages (EMAs), maintaining a bearish short-term outlook. These levels suggest that short- and medium-term trend resistance is limiting rallies. At 38.21, the 14-day Relative Strength Index (RSI) lies below the 50 mark, pointing to continued selling pressure rather than exhaustion from oversold conditions. Meanwhile, the elevated FXS Fed Sentiment Index reading of 145.61 underlines expectations of tighter monetary policy, a backdrop that continues to weigh on silver.

Any rebound faces initial resistance at $51.99, the nine-period EMA, followed by a stronger obstacle near $57.29 at the 50-period EMA. Without an improvement in momentum, a recovery would probably struggle at the latter level. Alongside these technical barriers, the FXS Fed Sentiment Index at 145.61 highlights the macroeconomic headwinds facing XAG/USD. On the downside, the RSI area around 38.21 suggests momentum support, as earlier declines have slowed there. However, the available dataset shows no clear structural price floor, leaving silver exposed to further losses should $51.35 fail to hold.

(The technical analysis of this story was written with the help of an AI tool. Know more.)