Silver Price Forecast: XAG/USD corrects to near $86.50 as Iran stops killing protesters

• Silver price retraces sharply from its all-time high of $93.51 as Iran tensions ease.

• Iran assured US President Trump that it will stop killings of protesters.

• The Fed is unlikely to cut interest rates in the policy meeting later this month.

Silver price corrects almost 6% to near $86.50 during the Asian trading session on Thursday. The white metal retraced from its all-time high of $93.51 posted on Wednesday after United States (US) President Donald Trump said that Iran assured it will stop killings of protesters, and has no plans of large-scale civil executions, resulting in a decline in appeal of safe-haven demand.

Market sentiment remained risk-averse as US President Trump threatened military action against the government of Supreme Leader Ayatollah Ali Khamenei for executing protestors amid civil unrest in Iran. The assurance from Tehran that it will stop executions of civilians has downplayed the risks of US military action.

Meanwhile, expectations from the Federal Reserve (Fed) that it won’t reduce interest rates in the policy meeting later this month are also weighing on the Silver. The speculation for the Fed pausing its ongoing monetary easing campaign intensified after the release of the US Consumer Price Index (CPI) data on Tuesday, which showed that price pressure remained sticky.

Going forward, the major trigger for the Silver price will be the announcement of the new Fed Chairman by the White House. US President Trump said in December that he would announce the successor of Fed Chair Jerome Powell sometime in January. The comments from Trump in his latest interviews showed that White House Economic Adviser Kevin Hassett, former Fed Chair Kevin Warsh, and current Fed Governors Christopher Waller and Michelle Bowman are major contenders to replace Jerome Powell.

Silver technical analysis

XAG/USD trades sharply lower to near $88.50 as of writing. The 20-day Exponential Moving Average rises and sits at $77.48, reinforcing an upward bias as THE price holds well above it. Its positive slope supports the trend and keeps pullbacks contained around the average.

The 14-day Relative Strength Index (RSI) at 68 (near overbought) reflects firm momentum after cooling from recent extremes, which could cap immediate upside if it stalls.

As long as the pair stays above the rising 20-EMA, bulls retain control, and an extension of the advance would remain the base case. A close below the 20-day EMA would shift the bias toward consolidation and open room for further downside toward the January 8 low of $73.85.

(The technical analysis of this story was written with the help of an AI tool.)