Silver price prediction: XAG/USD may revisit $38.61 amid weak dollar and volume divergence

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21.07.2025

Silver price prediction: XAG/USD may revisit $38.61 amid weak dollar and volume divergence — Silver climbs to a four-day high

Silver price has climbed 0.9% so far today, reaching a four-day high near the $38.50 resistance zone.

The rally began during the Asian session and has extended into the European session, supported by continued dollar weakness following dovish remarks from Federal Reserve Governor Christopher Waller last week. The comments triggered a pullback in the dollar, and silver has moved in line with that decline.

- Silver climbs to a four-day high as weak dollar supports demand across safe haven metals

- RSI rise above 61 and volume increase on the four-hour chart confirms bullish momentum

- Price now targets $38.61 imbalance zone while $38.15 remains critical short-term support

The rise in silver comes despite a notable divergence between price and volume. Silver ended the previous week with three consecutive bullish daily closes. However, these were accompanied by steadily declining volume, raising questions about the strength behind the rally. The lack of volume support typically suggests caution, but price action has defied that signal for now.

Silver price dynamic (June - July 2025). Source: Tradingview

Technical support for today’s rally is visible on the one-hour chart, where the 50 EMA at $38.15 helped lift price higher. This moving average is now reinforcing the weekly open as a key technical support. If price falls below that level, the week would shift from gains to losses, making the weekly open area a critical level for short-term structure.

Silver RSI rises above 61 while volume on 4H chart improves

More convincing strength is found on the four-hour chart. Volume over this timeframe has been steadily increasing, showing better participation behind the current move. The RSI on this same chart has now risen above 61, the highest in the last three days, confirming renewed bullish momentum.

Silver is now approaching a key technical zone between $38.43 and $38.61, where last week’s buy-side inefficiency sits. The current rally is positioned to rebalance that zone if momentum sustains. This zone, marked by a sell-side imbalance, is now being addressed as silver pushes higher.

No major U.S. economic data is expected today, leaving silver to trade on broader macro themes. Tensions around tariffs and ongoing conflict in the Middle East continue to support demand for safe haven metals. If silver can close above the $38.61 area, the focus would likely return to the 14-year high at $39.12. However, failure to hold above the weekly open could put $38.15 under pressure and invite a broader pullback.

Silver dropped after strong U.S. CPI data triggered heavy selling ahead of the PPI release. Silver bounced to $38 as RSI at 55 supported a mild recovery from the $37.55 low.

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