Silver (XAG/USD) attracts some buyers in Tuesday’s early European trading hours. The white metal currently trades around $88.00, up 1.20% for the day, after facing a volatile session at the start of a new week.
Against the backdrop of the recent repeated failures near the 100-hour Exponential Moving Average (EMA), acceptance below the $80.00 psychological mark would be seen as a fresh trigger for the XAG/USD bears and pave the way for deeper losses.
The Moving Average Convergence Divergence (MACD) indicator slips further into negative territory with the line extending below its signal, and the expanding negative histogram signals strengthening downside momentum. The Relative Strength Index (RSI) at 31.92 hovers just above oversold, indicating persistent selling pressure but also proximity to a zone where short-term bounces often emerge.
Meanwhile, immediate support is seen at the recent low around $79.50, where a decisive break would expose the next downside level near $78.50. Below that area, a deeper extension could target $78.00 as the next bearish objective. On the upside, initial resistance stands at $81.50, with a recovery above that level opening the way toward $82.50.
The near-term bias is mildly bearish as the XAG/USD holds well below the 100-period EMA near $84.50, keeping the recent downswing in control. Only a sustained move back above the said barrier would neutralize the current bearish tone and signal a more durable recovery phase.
(The technical analysis of this story was written with the help of an AI tool.)
XAG/USD 1-hour chart
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off” refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
