Silver Price Forecast: XAG/USD faces roadblock near $53.50 as US Dollar regains ground

Silver price (XAG/USD) gives back some of its early gains after rallying to near $53.50 on Thursday. In the European trade, the white metal is up 0.6% to near $52.50. The rally in the Silver price hits a roadblock as the US Dollar (USD) claws back some of its losses.

At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, is marginally down to near 101.44. The DXY bounced back after revisiting its monthly low of 101.10 posted the previous day.

However, the outlook of the Silver price appears to be bullish as the victory of United States (US) Democrats in midterm elections has jeopardized the medium-term appeal of the US Dollar.

Technically, a lower US Dollar makes the Silver price an attractive risk-reward bet for investors.

Dollar outlook darkens on US political frictions into 2027

Analysts at ING suggest that the US political backdrop could become an additional headwind for the Dollar over the medium term. They argue that “the dollar could see a little more weakness into 2027, however, if an emboldened Democratic Party takes greater issue with Republican policy, including deregulation and the AI build-out.” ING adds that “the potential for a prolonged government shutdown in mid-2027 adds to the case for a weaker dollar next summer,” reinforcing their view that rising political frictions may increasingly weigh on the currency’s appeal.

Going forward, investors will pay attention to the US Nonfarm Payrolls (NFP) data for October, which will be released on Friday. The labor market data is expected to influence Federal Reserve’s (Fed) interest rate expectations.

Silver Technical Analysis

In the daily chart, XAG/USD trades at $52.66, maintaining a bearish near-term bias as spot holds below the 20-day exponential moving average (EMA) at $54.66. The slide away from the recent highs keeps price positioned under this dynamic barrier, while the Relative Strength Index (RSI) at 39.85 remains in bearish territory but off oversold extremes, hinting at weak but stabilizing downside momentum rather than an imminent reversal.

On the topside, the 20-day EMA at $54.66 is the first meaningful resistance that bulls would need to reclaim to ease immediate selling pressure and open the door to a more sustained recovery phase. On the downside, the November 3 low at $48.62 is the immediate support level.