Silver Price Forecast: XAG/USD bulls remain focused on the $54.40 level

Silver remains steady near $54.00 after rejection at $54.40 area.

XAG/USD metal is on track for a nearly 8% rally this week.

Investors' hopes of Fed monetary policy easing are supporting speculative demand for precious metals.

Silver (XAG/USD) has failed to break November’s peak, at $54.40 area on Friday, weighed by a somewhat firmer US Dollar. The precious metal, however, remains close to $54.00, trading at $53,85 at the time of writing, after rallying nearly 8% this week.

The US Dollar Index (DXY), which measures the value of the USD against a basket of peers, is picking up from weekly lows amid a frail rebound in US Treasury yields on Friday's thinned Thanksgiving trading.

Nevertheless, the market is pricing a quarter-point rate cut by the Federal Reserve in December, and a few more next year, which is likely to keep speculative demand for the Greenback subdued and fuel the precious metal's rally.

Technical Analysis: The next upside targets are $54.40 and $54.85

The technical picture remains positive. The rejection at $54.40 earlier on Friday has been contained above $53.50. Oscillators are at positive levels. The 4-Hour RSI is right below oversold territory while the MACD is turning flat at high levels, suggesting the possibility of some consolidation.

On the downside, the intra-day low at the mentioned $53.50 level is the prime support area ahead of Thursday’s low at the $52.70 area and the November 25 low, near $50.70.

Bulls remain focused on the November 13 highs, at the $54.40 area, which is the last hurdle ahead of the multi-year high of $54.85 reached in mid-October. Further up, the 261% Fibonacci extension of the November 21-25 rally, a common exhaustion level, is at the $56.60 area.