Silver price prediction: XAG/USD consolidates below record high after sharp profit-taking

Traders Union
All News
Financial News
XAG/USD consolidates below record high

Highlights

- Silver consolidates below record high, reflecting trader indecision after extended nine-week rally.

- RSI cools from overbought levels as $52.44 resistance blocks immediate bullish attempts.

- Fed rate cut expectations and tariff tensions sustain silver’s medium-term bullish bias.

Last week’s rally had lifted silver price above $54 for the first time, marking a 9% gain for the week. The move was driven largely by dovish commentary from Federal Reserve Chair Jerome Powell, who hinted that the rate cut cycle would begin soon, and by the escalation of U.S.-China tariff tensions that boosted safe-haven demand. However, as the RSI on the daily chart had been heavily overbought around the 80 level, leading to an aggressive wave of profit-taking. The selloff sent prices down over 7% to a three-day low at $50.64 before recovering slightly to close the week at $51.80, still higher on a weekly basis.

Silver price dynamics (Sept - Oct 2025). Source: Tradingview

The heavy profit-taking printed a bearish order block on the daily chart, forming what appears to be a bearish engulfing pattern. This pattern signals strong seller participation and creates an overhead resistance zone that is now reinforced by the 20 EMA at $52.44. For now, this level has become a ceiling for any upward attempt. The structure of the 4-hour chart still shows higher highs and higher lows, suggesting that the broader trend remains bullish, but the near-term tone leans neutral to bearish as consolidation continues.

Fed rate cut bets and tariff tensions may sustain long-term bullish case for silver

Technically, the 4-hour RSI has dipped into bearish territory, which suggests weakening short-term momentum. The daily RSI, however, has corrected from overbought conditions and is now positioned in bullish territory, leaving room for another leg higher once profit-taking pressure eases.

On the fundamental side, the backdrop still favours silver in the medium term. The expected Fed rate cuts, ongoing tariff tensions between the U.S. and China, and rising demand from AI-related infrastructure are all supportive factors. However, since these drivers are already priced in, traders may seek fresh catalysts before pushing prices further into uncharted territory.

If prices fail to clear the $52.44 resistance and profit-taking resumes, silver could break below the 4-hour 50 EMA and retest the $50 psychological support. A sustained move below that level could open room toward $48. Conversely, a strong rebound above $52.44 backed by volume could reestablish bullish momentum toward $54 and beyond in the coming sessions.

Recently, we discussed silver consolidating between $52.30 and $53.35 as traders reassessed momentum. Fed easing expectations and a weaker dollar continued to support the bullish tone.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.