What to Know

  • Spot silver was trading at $61.27 at 13:25 GMT, down $3.04 or 4.72% on the session.
  • The metal traded as low as $60.95, coming within 11 cents of the $60.84 50% retracement of its all-time high.
  • Silver failed to hold the 50-day moving average at $63.87 and broke below the minor bottom at $62.31.
  • The retracement zone between $62.98 and $61.04 has shifted from support into resistance after Monday’s selloff.
  • The daily swing chart keeps the main trend pointed lower unless XAGUSD trades through $67.55.
  • Monday’s low at $60.95 is the first downside trigger, with $60.84 the next major technical test.
  • The 10-Year U.S. Treasury yield was back over 5.20%, while the 30-year was near 5.53% and the two-year was moving toward 4.92%.
  • Traders were pricing a 70.3% chance of an October rate hike, adding pressure to non-yielding metals.
  • The Dollar Index held above 101 after its best month since June, creating another headwind for silver.
  • Key labor and inflation data, including JOLTS, ADP employment, PCE and payrolls, may decide whether buyers can defend the 50% level.

Silver Slides Into a Critical Long-Term Value Zone

Silver entered Monday’s New York trading window under heavy pressure, with sellers driving spot XAGUSD through one technical level after another. At 13:25 GMT, spot silver was trading at $61.27, down $3.04 or 4.72%, after touching an intraday low of $60.95. That move placed the market within striking distance of the $60.84 50% retracement of its all-time high, a level that many technical traders are watching as a possible long-term value marker rather than a confirmed bottom.

The speed of the decline matters. Silver did not simply drift lower into support. It broke the 50-day moving average at $63.87, lost the minor bottom at $62.31 and moved below the retracement support zone at $62.98 to $61.04. When a market loses multiple supports in a short period, chart watchers often treat the broken levels as potential resistance on any rebound. That is now the challenge for silver bulls. A bounce from near $60.84 may attract attention, but a durable recovery would likely need to reclaim several levels that were just surrendered.

Technical Picture Keeps Sellers in Control

The main trend remains down on the daily swing chart. A move through $67.55 would be needed to change the main trend to up, leaving silver some distance from a meaningful trend reversal. In the near term, Monday’s low at $60.95 has become the immediate downside trigger. A trade through that level would put the $60.84 50% retracement directly in play and may test whether longer-term buyers are willing to step in.

The former support band from $62.98 to $61.04 is now a key resistance area. A close back above $61.04 would put silver back inside that zone, but buyers would still need to clear the broken minor bottom at $62.31 and then $62.98 to demonstrate better control. Above that, the 50-day moving average at $63.87 is the level controlling the short-term direction. The 200-day moving average at $73.15 remains the longer-term directional marker, underscoring how far silver has moved away from the broader bullish structure that previously supported the rally.

Some chart watchers view the area near the 50% retracement as the first clear value zone after the rally from the July bottom at $54.78 to the $71.56 high. The midpoint of that swing sits at $63.17, and silver cut through it during Monday’s decline. That failure reduces the importance of the first bounce and raises the importance of the second attempt. A quick short-covering move can happen when prices approach a watched retracement level, but buyers still need follow-through to prove that the selloff has exhausted itself.

Passive Buying Has Not Yet Changed the Tone

Buying interest has appeared near the lows, but it has not yet been strong enough to shift control away from sellers. Silver has been holding a narrow range just above the session low, suggesting that some bids are present below $61.00. However, passive bids do not necessarily create a reversal. For the tone to improve, sellers need to stop pressing offers and buyers need to lift the market back above broken support.

The next rally attempt is therefore more important than the first. If silver rebounds and stalls below $61.04, the market would remain vulnerable to another test of $60.95 and $60.84. If buyers can push prices back into the former retracement zone and hold there, the tone may begin to stabilize. A move above $62.31 would be a stronger early signal that sellers are losing momentum, while a recovery above $62.98 would put the market on firmer short-term footing.

Oil, Inflation Expectations and Rate Bets Add Pressure

Macro conditions are not helping silver. Oil was higher Monday after President Trump rejected Iran’s offer to end the conflict and reopen the Strait of Hormuz. For precious metals, the immediate market read was firmer inflation expectations and a Federal Reserve with more room to keep policy tight. Traders were pricing a 70.3% chance of an October rate hike, and higher crude prices may reinforce that view if they continue to feed inflation concerns.

Silver can struggle when rate expectations rise because the metal does not offer yield. Higher expected interest rates can increase the opportunity cost of holding non-yielding assets, particularly when bond yields are also moving higher. Gold is facing similar pressure, but silver fell harder because its chart had more nearby levels to lose. Once the 50-day moving average and several support points gave way, technical selling accelerated.

At current levels, the risk-reward profile may be improving for longer-term buyers, but that does not mean a low is already in place. Fresh selling may be required to push silver much lower, yet the market’s immediate focus remains on rates. Value-oriented participants can afford to wait for confirmation from the incoming data rather than trying to call a bottom while yields and the dollar remain firm.

Treasury Yields and the Dollar Remain Major Headwinds

The Treasury market continues to set the pace for silver’s slide. The 10-Year U.S. Treasury yield was back over 5.20% Monday, following its highest level since 2007 a week earlier. The 30-year yield was near 5.53%, while the two-year yield was moving toward 4.92%. That curve is not favorable for silver. As long as yields keep rising, buyers are fighting both the bond market and the bearish technical structure.

The Dollar Index is also working against silver, holding above 101 after its best month since June. A firm dollar can weigh on dollar-denominated commodities by making them more expensive for holders of other currencies and by reinforcing the broader case for tighter U.S. financial conditions. With both yields and the dollar moving against it, silver needs either a technical capitulation near support or a macro shift to produce a more convincing recovery.

A short-covering bounce from the 50% retracement would not require much if sellers decide to take profits near $60.84. However, anything more sustained would probably need Treasury yields to back away from recent highs or the dollar to lose momentum. Without that help, rallies may continue to attract sellers near broken support levels.

Data Calendar May Decide the Next Break

The week’s economic calendar is unusually important for silver because it may challenge or reinforce the October rate-hike trade. The Job Openings and Labor Turnover Survey is scheduled for Tuesday. ADP employment data and the Personal Consumption Expenditures reports are due Wednesday. The payrolls report on Friday carries the most weight for rate expectations and may become the decisive event for whether silver can defend the 50% retracement area.

A hot PCE reading or firm payrolls number would likely support higher October hike odds, which could keep yields elevated and increase pressure on XAGUSD. In that scenario, Monday’s low at $60.95 could come under renewed attack, and a sustained move below $60.84 would weaken the longer-term technical picture. Softer data would offer the opposite setup, potentially pulling the 10-Year yield away from recent highs, cooling the dollar and giving silver room to rebuild above nearby resistance.

Levels to Watch for XAGUSD

For now, sellers have control while silver trades below $62.98 and the 50-day moving average at $63.87. The first key downside level is Monday’s low at $60.95, followed closely by the $60.84 50% retracement. If that area fails on a sustained basis, technical traders may begin looking for lower support, though the immediate focus remains on how silver behaves around this long-term value zone.

On the upside, a close back above $61.04 would move silver into the former retracement zone and may ease some immediate downside pressure. The next recovery target would be $62.31, the broken minor bottom, followed by $62.98. A move through those levels would not automatically turn the main trend higher, but it would suggest that buyers are beginning to absorb supply. Until then, the metal remains vulnerable to further weakness if yields, the dollar and rate expectations stay firm.

Frequently Asked Questions (FAQs)

Why did silver fall sharply on Monday?

Silver fell as sellers pushed the metal below several key technical supports, including the 50-day moving average at $63.87 and the minor bottom at $62.31. Firm Treasury yields, a stronger dollar and rising rate-hike expectations added to the pressure.

What is the key silver price level traders are watching?

The main level in focus is the $60.84 50% retracement of silver’s all-time high. Spot silver traded as low as $60.95, placing it within 11 cents of that major technical marker.

Is silver in an uptrend or downtrend?

The main trend remains down on the daily swing chart. A trade through $67.55 would be needed to change the main trend to up, while a move below $60.95 would keep downside pressure active.

What resistance levels matter for silver now?

The former support zone from $62.98 to $61.04 has become resistance. Buyers would need to regain $61.04, then challenge $62.31 and $62.98 before the 50-day moving average at $63.87 comes back into focus.

How are Treasury yields affecting silver?

Higher Treasury yields increase the opportunity cost of holding non-yielding metals such as silver. The 10-Year yield was back over 5.20%, while the 30-year was near 5.53% and the two-year was moving toward 4.92%, all of which created a difficult backdrop for buyers.

Why does the dollar matter for XAGUSD?

Silver is priced in U.S. dollars, so a firmer dollar can pressure the metal by making it more expensive for holders of other currencies. The Dollar Index held above 101 after its best month since June, adding another headwind.

Could silver bounce from the 50% retracement level?

A short-covering bounce from around $60.84 is possible if sellers take profits or buyers defend the level. However, a stronger recovery would likely require silver to reclaim broken resistance levels and may also need yields or the dollar to lose momentum.

What economic data could move silver this week?

Traders are watching JOLTS on Tuesday, ADP employment and PCE reports on Wednesday, and the payrolls report on Friday. These releases may influence October rate-hike expectations and, in turn, silver’s next directional move.

What would weaken silver’s long-term technical picture?

A sustained move below the $60.84 50% retracement would weaken the long-term setup and expose the market to lower support. Buyers need to defend that area and recover back above nearby resistance to stabilize the outlook.