Silver Price Forecast: XAG/USD rallies past $47.50 amid US Dollar’s weakness

LONDON (October 3) Silver (XAG/USD) has resumed its bullish trend on Friday to retrace most of Thursday’s losses, supported by a softer US Dollar. XAG/USD has reached session highs above $47.50 after bouncing at $46.00 on Thursday, and is drawing closer to the long-term highs, in the area of $48.00.

Precious metals are rallying, as investors shrug off the hawkish comments from Fed’s Logan, putting further rate cuts into question. The downbeat employment figures seen earlier this week and the US Government shutdown have boosted investors’ expectations that the US central bank will cut rates in October, and, highly likely, also in December

Technical Analysis: The multi-year high at $48.03 is drawing closer

The pair’s corrective pullback found support right below $46.00 on Thursday and is trading higher, at least for now. The 4-hour RSI has returned below the overbought area and, although the daily chart keeps showing signs that the rally is overextended, right now there is room for further appreciation.

Immediate resistance is at the mentioned $48.00 area, which capped bulls on Wednesday and Thursday. Beyond here, the top pf the near-term bullish channel is around $48.65. The 161.8% extension of the September 17-23 bullish run, at $49.15, further down, the next targets are at $45.30 (September 25 high) and $44.50 (September 23 high).

To the downside, immediate support area is at the area between the bottom of the mentioned channel, now at $46.15 and the September 30 and October 2 lows, around $45.95  from current levels might find support at the $45.96 intraday lows ahead of the previous long-term highs, at $45.30 (September 25 high) and $44.45 (September 23 high).

FXStreet