Silver Price Forecast: XAG/USD appreciates further and looks to $50.00

LONDON (October 9) Silver (XAG/USD) accelerated its recovery on Thursday, with precious metals trading firmer despite the US Dollar’s strength. The pair has reached fresh long-term highs, near 49.70, drawing closer to the $50.00 psychological levels.

Precious metals remain bid on Thursday, fuelled by the political uncertainty in France and Japan, while the US government shutdown enters its eighth day without a solution in sight.

Earlier in the day, New York Fed President John Williams showed his support for further rate cuts, while the focus now shifts to Fed Chairman Jerome Powell and Governor Michelle Bowman, who are expected to talk at a banking event in Washington later today.

Technical analysis: The $50.00 psychological level is attracting bulls

Silver remains heading north, the pair has rallied more than 20% in the last three weeks and is looking overstretched, but the fundamental scenario remains supportive, and there are no signs of a correction other than the bearish divergence on the 4-hour RSI

The white metal bounced from $48.40 in early trading on Thursday and has reached the 49.70 area, with bulls targeting the $50.00 level, where the top of the ascending channel from the mid-September lows meets the price. Further up, the 161.8% Fibonacci extension of the early October rally is at $50.70.

On the downside, immediate support is at Wednesday’s low of $48.40 ahead of the confluence of trendline support with the October 7 lows, at $47.50, and the September 30 and October 2 lows, at the $45.90-$46.00 area.

FXStreet