FX.co ★ MMC | XAG/USD, SILVER

Silver (XAG/USD) sinks to new yearly lows after falling 5.8% yesterday, as worries about artificial intelligence-linked investments hurt the stock market but fail to drive demand for silver as a haven, since investors prefer government bonds. Some traders may be selling precious metals to cover equity losses. The white metal's price has fallen about 55% from its January high of almost $121. This fall reflects rising energy prices from the war in the Middle East, which began in late February and has contributed to inflation. Major central banks, including the Federal Reserve (Fed), have raised interest rates to fight inflation. Next week's Fed meeting may determine whether silver continues to fall or recovers. Markets expect that the US central bank will keep interest rates steady despite a quarter-point increase in September. Nonetheless, policymakers' desire to bring inflation back to 2% means there is still a chance of further interest rate increasesrate increases this year before year-end. According to the CME FedWatch Tool, markets see an 80% probability of a December rate hike. Silver (XAG/USD) continued its downtrend on Friday, down more than 1% to a new year-low of $53.03, setting up a possible test of $50.00 in the coming days. As of now, XAG/USD is trading around $54.00. The downtrend will continue after a new low in silver prices, leading to further declines. The RSI is bearish and heading toward oversold territory, showing sellers are gaining strength as XAG/USD declines. The first support comes at $53.50. A break below that level will test the yearly low at $53.05, followed by the $50.00 handle. The next level to watch is the November 21, 2025, swing low at $48.64, ahead of the October 28, 2025, swing low at $45.56. In a bullish scenario, silver should climb above $55.00. After breaking that handle, the next target is the October 22 high at $58.02, followed by $60.00.