Silver (XAG) Forecast: Will the 200-Day Moving Average Be Tested as Dollar Strengthens?

Silver Tests Key Levels as Traders Eye Fed Decisions

Silver prices fell over 1% on Monday, trading near $30.61, a key pivot level. The metal remains under pressure, with support at $29.68 and the 200-day moving average at $29.15 providing critical floors. A sustained move above $30.61 could trigger a rally toward $31.29, followed by resistance at $31.54 and the 50-day moving average at $31.82.

However, the broader trend remains bearish as traders monitor a packed economic calendar, including Federal Reserve Chair Jerome Powell’s speech on Wednesday, U.S. jobs data on Friday, and the December 18 Fed policy decision.

At 12:57 GMT, XAG/USD is trading $30.40, down $0.22 or -0.71%.

Gold Faces Dollar Pressure; Can Safe-Haven Demand Hold?

Gold also declined 1% on Monday, reversing four consecutive sessions of gains. The metal was weighed down by a stronger U.S. dollar, which rose 0.5% for its best single-day performance in over a week. This dollar strength made gold more expensive for holders of other currencies, contributing to a reversal after last month’s 3% decline—its steepest since September 2023. While the dollar’s rise has pressured prices, ongoing central bank purchases and geopolitical tensions provide some support.

Trump’s Stance on BRICS Sparks Uncertainty for Markets

Silver and gold faced additional pressure following comments by U.S. President-elect Donald Trump over the weekend. Trump demanded that BRICS nations pledge not to create or endorse any alternative currency to the U.S. dollar, warning of 100% tariffs on nations that fail to comply. His remarks on Truth Social underscored the dollar’s dominance in global trade but added to market uncertainty. The possibility of heightened geopolitical tensions has traders reevaluating safe-haven demand for precious metals.

Key Events Could Drive Volatility in Metals Markets

The metals market is gearing up for a volatile week as investors await Powell’s comments, along with key U.S. economic data, including the ADP employment report, job openings data, and Friday’s non-farm payrolls. These reports could shape expectations for the Federal Reserve’s upcoming interest rate decision, with major brokerages forecasting a 25-basis-point cut in December.

Outlook for Silver and Gold Prices

Silver’s technical outlook remains bearish as it trades between key moving averages. A break above $30.61 could signal a short-term rebound, while a failure to hold support at $29.68 risks a pullback toward $29.15. Gold’s safe-haven appeal may limit further downside, but the metal’s direction will depend heavily on dollar strength and the Fed’s policy signals. Overall, precious metals are likely to react sharply to economic data and geopolitical developments this week.

More Information in our Economic Calendar.