Silver (XAG/USD) fell during the Asian session on Thursday, extending the prior day’s modest pullback from the weekly high. It traded just below the mid-$73.00s, down 2.0% on the day.
Price action failed overnight near the 200-period Exponential Moving Average (EMA) on the 4-hour chart. It also moved below the 38.2% Fibonacci retracement of the March decline.
Momentum Signals Turning Lower
The Relative Strength Index (RSI) was 48.18, near neutral. The Moving Average Convergence Divergence (MACD) slipped slightly below zero and its histogram weakened.
Resistance sits at the 38.2% Fibonacci level at $74.53. Further resistance is seen at the 200-period EMA at $76.76, ahead of the 50.0% retracement at $78.68.
On the downside, the 23.6% Fibonacci retracement at $69.41 is the first support area. Lower down, support is noted near the cycle low at $61.12.
The technical analysis in the original report was produced with the help of an AI tool.
Macro Drivers And Trade Positioning
Given the current weakness in silver, we see that the upside momentum is fading. The failure to break above the 200-period moving average suggests that sellers are still in control for now. This technical setup points towards a potential further slide in the near term.
This view is strengthened by the latest March 2026 inflation report, which came in at 3.1%, slightly above expectations and tempering bets for an early Fed rate cut. A strong dollar typically weighs on precious metals, and the Dollar Index (DXY) has subsequently climbed to a three-month high of 106.50. This macroeconomic pressure supports the bearish technical indicators we are observing on the charts.
For the coming weeks, traders could consider buying put options to capitalize on a potential move down towards the $69.41 support level. Alternatively, selling call credit spreads with a ceiling around the $74.53 resistance offers a strategy to profit if the price remains stagnant or drifts lower. Defining risk for any short futures positions near that same $74.53 level would be a prudent measure.
We must also consider the recent slowdown in manufacturing, as China’s March 2026 Caixin Manufacturing PMI dipped to 49.8, indicating a slight contraction. While long-term industrial demand for silver in solar and EVs remains a powerful narrative, this short-term dip in industrial activity could remove a key pillar of support for prices. This aligns with the potential for silver to test lower structural floors, possibly near the cycle low of $61.12 if bearish momentum accelerates.
Looking back, we saw how sensitive silver was to geopolitical news during the sharp rally in the second half of 2025. This means that while our current bias is bearish, any unexpected escalation in global tensions could cause a rapid reversal. Therefore, maintaining disciplined stop-losses on bearish positions is essential to manage the risk of a sudden sentiment shift.
