Silver (XAG) Forecast: Powell’s Testimony & Gold’s Reversal Could Deepen Losses

Silver tested a major retracement zone between $31.81 and $32.53 but failed to sustain momentum, signaling potential downside. The market is now straddling the lower boundary, increasing the risk of a drop toward support at $31.17 and $30.69. Further declines could target the 50-day moving average at $30.61 and the 200-day moving average at $30.32.

Silver typically attracts dip-buying interest, especially when economic uncertainty supports safe-haven demand. However, near-term price action remains vulnerable as broader market sentiment shifts.

Gold’s Reversal Puts Pressure on Silver

Gold surged to an all-time high of $2,942.78 before pulling back, raising concerns that the rally had become overheated. The RSI remains in overbought territory, and the price gap between spot gold and its 50-day moving average suggests further downside is possible.

Silver often mirrors gold’s movements, and a deeper correction in gold could accelerate selling in silver. If gold sees a confirmed bearish reversal pattern, silver may struggle to hold its current support levels, especially if technical traders follow gold’s lead and reduce positions.

Powell’s Testimony and Tariff Uncertainty Weigh on Markets

The Federal Reserve’s policy outlook remains a key driver for precious metals. Powell’s Congressional testimony will be closely analyzed for signals on inflation and rate expectations. With inflation still running above the Fed’s 2% target, any indication of prolonged rate stability could strengthen the dollar and pressure silver.

Meanwhile, Trump’s 25% tariffs on steel and aluminum imports have reignited concerns over rising costs. If Powell acknowledges the inflationary risks of tariffs, traders may shift expectations toward a more hawkish Fed, which could negatively impact silver and gold. However, if Powell strikes a cautious tone, emphasizing patience, silver could find renewed support.