Silver price forecast: XAG/USD hits $62.9 amid third daily gain as Fed rate cut lifts sentiment

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Silver hit record levels amid Fed rate cut

Highlights

Silver reached $62.9 after Fed rate cut lowered real yields and weakened the dollar.
Pullback to $61.6 showed weak selling pressure as 20 EMA provided strong support.
Daily RSI at 78 signals possible profit taking if price slips below $61.5

The initial pullback to $60.1 ahead of the decision reflected temporary profit-taking as investors paused to gauge any unexpected comments during the FOMC press conference. That decline was softened by the 50 EMA on the 1-hour chart, providing technical support at a key level before the Fed news crossed the wires.

Silver price dynamics (Dec 2025). Source: Tradingview

Following the rate cut, silver price surged 4.6% into the next session, as real yields dropped. The benchmark 10-year Treasury yield fell three and a half basis points to 4.155%, while real yields dropped to 1.895%. Since precious metals often move inversely to real yields, the decline reinforced bullish momentum. At the same time, the U.S. Dollar Index (DXY) dropped over 0.6% to 98.55, which further strengthened silver’s appeal as an alternative store of value.

Silver gains 7% weekly as DXY drop and real yield decline support upside

Today’s pullback from the Asian high of $62.9 occurred on declining volume, indicating a lack of strong selling pressure. That retracement was again supported, this time by the 20 EMA near $61.6. Interestingly, this level had acted as resistance a day before and has now turned into near-term support. The rebound off that zone pushed price back toward $62.2 as the European session progressed.

Beyond technical drivers, the macro narrative from the FOMC remained mostly unchanged. Jerome Powell reiterated that while inflation pressures are still high, downside risks to employment have grown, creating tension in the Fed’s dual mandate. That policy backdrop has yet to resist silver’s upward drift.

Intraday gains are already exceeding 1%, positioning silver for a third straight daily gain. On a weekly basis, price is up over 7%, while the month-to-date gain has now reached around 10%. However, the daily RSI is now in overbought territory near 78, its highest level since silver first broke into the $54.5 region in October. This sets up a possible near-term profit-taking scenario if price breaks below $61.5. The next downside support sits at $61, reinforced by the 50 EMA on the hourly chart.

In recent analysis, we discussed how silver broke out of its six-day range and surged 4.7% after strong U.S. labor data. XAG/USD hit a record high of $61.6 as traders priced in a potential Fed rate cut.

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