Silver Price Forecasts: XAG/USD retraces losses and rallies beyond $63.50

LONDON (December 15) Silver’s (XAG/USD) appreciates more than $2 so far on Monday, reaching intra-day gains near $63.80 and approaching the fresh all-time highs at $63.65, after bouncing from lows near right below the $61.00 line on Friday.

Precious metals are trading on a firm tone on Monday, fuelled by a cautious market mood following soft data from China and fresh concerns about the country’s property sector amid news that the state-owned developer, China Vanke, is on the brink of bankruptcy.

Beyond that, US President Trump has pointed to former Fed Governor Kevin Warsh as the best positioned to replace Chairman Powell at the end of his term in May. Trump also said, in an interview with the Wall Street Journal, that the next Fed chair will have to listen to him when deciding about monetary policy, which points towards further monetary easing next year.

Technical Analysis: Silver has an important support at the $61.00 area

The 4-hour chart shows the XAG/USD pair trading at $63.73, above 3% above the day’s open. The Relative Strength Index (RSI) at 64 stays above its midline, keeping momentum positive without overbought conditions. The Moving Average Convergence Divergence (MACD), on the other hand, has slipped below zero, reinforcing a cautious tone.

The pair keeps trading within a rising channel from mid-November lows at $48.57, with bulls aiming for Friday's high, at $64.66, and the top of the channel, now in the area of $66.00. Further up, the 70.00 psychological level emerges as the next target.

On the downside, the area between trendline support now around $61.45 and Friday's low, at $60.80, is likely to pose a significant challenge for bears. A confirmation below here would open the path towards the October 7, 8, and 9 lows, in the area of $57.60.

FXStreet