Silver is holding at $58, but technical overheating... Pay attention to the economic calendar timing

New_Ser_Ngmi · 2026-01-06T15:24:23+00:00

The recent movements in silver (XAG/USD) reveal market conflicts, with the price remaining volatile despite bullish factors like Fed rate cut expectations. A technical divergence suggests potential corrections before further gains, highlighting critical support and resistance levels for traders to monitor.

New_Ser_Ngmi

2026-01-06 15:24:23

Abstract generation in progress

Last Wednesday, the movement of (XAG/USD) in the New York foreign exchange market clearly revealed internal market conflicts. Despite the bullish factors of expectations for a Fed rate cut and a weak dollar, the market closed down 0.14% due to a surge in profit-taking sell-offs. Spot silver briefly dropped to $57.54 during the day, but rebounded to $58.49 on buying interest at lower levels, though it lost upward momentum.

Why are there warning signals despite hitting new price highs?

From a technical perspective, the key point is the divergence between silver prices and indicators. Silver continues to hit new highs, yet the 14-day RSI(Relative Strength Index) shows a weakening downward trend. This signals that buying momentum is gradually waning, suggesting that technical correction may precede further gains.

Fortunately, the overall bullish trend remains solid. Even when prices dipped into the mid-$57 range during the day, silver quickly regained the psychological $58 level, demonstrating strong support.

Two critical levels for short-term traders

If a correction phase unfolds, the first support level is $53.80–$54.00. This area has transformed from a previous resistance into a strong support zone, serving as a potential springboard for technical rebound. If prices fall further here, there is room to retest the 50-day simple moving average($50.25).

Conversely, if the correction is short-lived and prices resume upward movement, breaking $59.00 is crucial. Securing this level could lead to a scenario of breaking the psychological resistance at $60.00 and reaching new highs.

Why a cautious approach is advisable ahead of the economic calendar

As mentioned earlier, expectations for a Fed rate cut have supported silver, but upcoming economic calendar releases will serve as a test for this optimism. Therefore, in the current phase, a conservative trading strategy focusing on closely monitoring the support at $53.80 and the breakout above $59.00 is effective.

In short, the silver trend remains alive, but technical warning signals are flashing. It is essential to stay prepared for volatility, keeping the economic calendar in mind.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.