Silver Price Forecast: XAG/USD trades broadly flat around $82.80 as investors await US NFP
- Silver price consolidates around $82.80 ahead of the US NFP data for February.
- Dovish Fed bets for the July policy meeting have squeezed after upbeat ADP Employment data.
- Iran conflicts are expected to continue supporting demand for safe-haven assets.
Silver price (XAG/USD) trades broadly sideways around $82.80 during the European trading session on Friday. The white metal consolidates as investors await the United States (US) Nonfarm Payrolls (NFP) data for February, which will be published at 13:30 GMT.
Investors will pay close attention to the US NFP data to get fresh cues on the Federal Reserve’s (Fed) monetary policy outlook. Traders trimmed dovish Fed bets for the July policy meeting after the release of the US ADP Employment data for February on Wednesday, which showed that the number of fresh jobs created in the private sector was higher than projected.
The CME FedWatch tool shows that the odds of the Fed holding interest rates steady in the July policy meeting have increased to 51.7% from 25.3% seen a week before.
The US NFP report is expected to show that employers hired 59K fresh jobs, significantly lower than 130K in January. The Unemployment Rate is seen as steady at 4.3%. Meanwhile, Average Hourly Earnings, a key measure of wage growth, is estimated to have remained steady at 3.7% Year-on-Year (YoY).
Signs of strong labor demand and accelerating wage growth would further prompt expectations that the Fed will hold interest rates steady in the near term, a scenario that will be unfavorable for the Silver price. Non-yielding assets, such as Silver, remain on edge in a steady interest rate environment.
On the geopolitical front, the escalating war in the Middle East, which involves the US, Israel, and Iran, is expected to continue offering support to the Silver price. Safe-haven assets, such as Silver, tend to perform better in a heightened geopolitical environment.
Silver technical analysis
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XAG/USD trades at around $83.21at the press time. The near-term bias seems neutral as the price trades close to the 20-day Exponential Moving Average (EMA), which has also started to flatten around $84.80 and no longer offers directional support. The sequence of lower highs from the mid-$110s into the recent $90 area underscores waning upside momentum, while the 14-day Relative Strength Index (RSI) wobbling inside the 40.00-60.00 zone, signaling a lack of strong buying pressure and favoring a defensive tone.
Immediate resistance emerges at the 20-day EMA near $84.80, followed by the recent swing area around $90.00, where prior rebounds stalled. A daily close above $90.00 would be needed to ease the current downside bias and reopen the way toward the mid-$90s. On the downside, initial support sits near the recent $82.00 low, with a break exposing the $78.00 region as the next key floor. A sustained move below $78.00 would confirm a deeper corrective phase toward the mid-$70s zone.
(The technical analysis of this story was written with the help of an AI tool.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
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