Silver Price Forecast: XAG/USD slumps nearly 60% from January peak as as downturn deepens

Silver (XAG/USD) extends its decline on Friday, falling more than 5% and breaking below $50 to its lowest level since November 2025. The white metal is on track to lose around 18% in October, its steepest monthly decline since June, when it fell 22%.

The slide comes amid broader weakness in precious metals, with Gold (XAU/USD) also falling below $4,000 to levels last seen in October 2025. Precious metals have faced heavy selling pressure since the Middle East war erupted in late February, pushing Oil prices sharply higher and pressuring major central banks, particularly the Federal Reserve (Fed), to raise interest rates to contain inflation.

Higher borrowing costs reduce the appeal of assets such as Silver, which offers no interest income. Traders anticipate another Fed rate hike in December after the central bank left rates unchanged at 3.75%-4.00% on Wednesday.

Silver now trades nearly 60% below its all-time high near $121 reached in January. The latest leg lower may also reflect forced liquidation as a technology stock sell-off over heavy AI spending unsettles financial markets. Investors facing losses elsewhere may be selling precious metals to raise cash, while a broadly firmer US Dollar (USD) adds to the pressure.

Technical analysis

On the daily chart, XAG/USD extends its slide well below the 50-day, 100-day and 200-day Simple Moving Averages (SMAs), reinforcing a clear bearish bias. The prevailing downward trend line, now broken at $60, remains an overhead reference, while momentum gauges underline selling pressure: the Relative Strength Index (14) at 23 sits in oversold territory and the Moving Average Convergence Divergence (MACD) indicator stays below zero with a negative reading, hinting that the downside trend is both strong and still intact, as supported by an elevated Average Directional Index (ADX) near 39.

On the upside, immediate resistance emerges at the horizontal barrier of $50, followed by $55 before the broken trendline region around $60 comes into play. This region closely aligns with the 100-day SMA and the 50-day SMA at $61, together forming a dense resistance cluster, while the 200-day SMA at $70.39 marks a more distant structural ceiling.

On the downside, next support lies at the horizontal level near $45, with further losses possible if selling pressure intensifies. While the market appears oversold, only a sustained recovery above the $50-$55 band would begin to ease the immediate bearish pressure.