Silver Price Forecast: XAG/USD eases from 14-Year high amid risk-on mood

• Silver eases below $39.00 on Friday after hitting a 14-year high of $39.53 earlier in the week.
• The pullback is driven by an improved risk appetite and a modest rebound in the US dollar.
• The RSI on the daily chart eases to 65, signaling a healthy cooldown from overbought territory.

Silver (XAG/USD) corrects lower for a third day on Friday, easing to around $38.84 after hitting a fresh 14-year high of $39.53 earlier in the week. The pullback reflects improved global risk sentiment and a modest rebound in the US Dollar (USD), as upbeat US macro data and signs of easing trade tensions dampen safe-haven demand. Despite the decline, the metal remains up nearly 1.70% so far this week, underscoring the strength of the broader bullish trend.

Silver (XAG/USD) Daily Timeframe

On the daily timeframe, Silver continues to trade within a well-established ascending channel that has contained price action since April. The metal remains comfortably above both the 21-day Exponential Moving Average (EMA) at $37.81 and the 50-day EMA at $36.41. Both EMAs are sloping upwards, indicating that the bulls are still in control.

The Relative Strength Index (RSI) on the daily chart has eased to 65 from overbought levels, reflecting a healthy cooldown rather than a trend reversal.

Immediate support lies at $38.70, the July 22 low, followed by the psychological $38.00 mark. A break below these levels could accelerate the downside toward the 21-day EMA at $37.81. Further weakness may bring stronger support near $36.41, where the 50-day EMA aligns with the lower boundary of the ascending channel. On the upside, $39.00 now serves as the first hurdle, followed by $39.53 high of July 23.

A decisive move above this zone could reignite bullish momentum and pave the way for a test of the psychological $40.00 handle, with potential extension toward $42.00 and beyond.

Silver (XAG/USD) 1-Hour Chart

The hourly chart shows bearish pressure building, despite an earlier bullish setup. Silver recently carved out a classic cup-and-handle formation, with the handle forming as a falling wedge pattern -- usually a bullish sign. However, the breakout attempt above the $39.00 mark lacked follow-through, and the price has since fallen back below the 21-period EMA at $38.96 and the 50-period EMA at $39.00. Notably, the 21-period EMA has now crossed below the 50-period EMA, turning these levels into immediate resistance.

On the downside, if the price breaks below the lower boundary of the handle formation, it could trigger further weakness toward $38.50 in the near term. The Relative Strength Index (RSI) on the hourly chart has also retreated to near 41, reflecting fading intraday momentum and a possible consolidation phase. Meanwhile, the Average Directional Index (ADX) remains elevated at around 37, indicating a still-active trend, although the loss of upward follow-through signals is growing caution among bulls.