Silver (XAG) Forecast: Can the Market Rebound After Falling to $64.06?

The silver market has entered a turbulent phase, drawing the attention of traders, investors, and commodity analysts worldwide. After a strong upward move in previous months, silver (XAG) recently dropped to $64.06, a price that many traders consider a critical psychological and technical support level. This sharp decline has sparked conversations about whether the market is preparing for a reversal — or whether more downside could be on the way.

With global economic shifts, geopolitical tensions, and changing investor risk appetite, silver’s behavior in early 2026 has become a major focus. As the precious metal hovers around the low $60 range, the key question is: Will silver rebound from here? Or is the decline part of a larger correction?

Why Silver Dropped to $64.06

Several factors played a role in pushing silver down to this level. Although precious metals often act as safe-haven assets, they also react strongly to macroeconomic expectations:

1. Strengthening US Dollar

In recent weeks, the US dollar index (DXY) has surged amid expectations of tighter monetary policy. Historically, when the dollar strengthens, commodities priced in dollars — including silver — tend to fall because they become more expensive for global buyers.

2. Shifting Inflation Outlook

Inflation data from major economies has shown signs of easing. When inflation expectations decline, investors reduce positions in commodities like silver that typically act as inflation hedges.

3. Profit-Taking After Previous Rally

Silver experienced strong bullish momentum earlier, with prices climbing significantly. Some of the decline to $64.06 reflects traders locking in profits before the new quarter begins.

4. Slower Industrial Demand Growth

Unlike gold, silver is heavily used in industrial applications — from solar panels to electronics. Recent manufacturing reports indicate slower-than-expected demand growth, which added downward pressure.

Technical Overview: Is $64.06 a True Support Level?

Technical analysts argue that the $64 region is important for several reasons:

It aligns with a previous demand zone, where buyers historically stepped in.

It matches the 38.2% Fibonacci retracement of the last major rally.

Momentum indicators such as the RSI and MACD are showing signs of oversold conditions.

The market’s reaction at this level is therefore crucial. If silver maintains support above $64, it could signal stability. However, if the price breaks decisively below $63, a further drop may follow.

Bullish Case: Why a Reversal Could Be Near

Despite the recent fall, many analysts view this decline as a temporary correction rather than the start of a prolonged downtrend. Several bullish arguments support the possibility of a rebound.

1. Oversold Market Conditions

Technical indicators suggest that silver has dropped too quickly. Oversold conditions often lead to short-term rebounds as bargain buyers enter the market.

2. Continued Long-Term Industrial Demand

Even with short-term slowdowns, long-term industrial demand remains strong. Global investment in renewable energy, especially solar power, relies heavily on silver. As more countries expand solar infrastructure, silver demand is expected to rise again.

3. Central Bank Interest Rate Uncertainty

Although investors expect tighter monetary policy, central banks could still adjust if economic conditions weaken. Any signal of rate cuts or dovish policies would likely boost silver prices.

4. Safe-Haven Appeal During Geopolitical Risks

With ongoing global tensions, precious metals often gain favor as safe-haven assets. Silver could benefit if geopolitical risks intensify.

Bearish Case: Could the Decline Continue?

While many are optimistic, bearish traders argue that silver may still have room to fall before stabilizing.

1. Continued Strength in the Dollar

If the US dollar continues its rally, silver could face additional downward pressure.

2. Weak Manufacturing Data

Industrial output in several major economies has slowed. As long as manufacturing remains under pressure, silver’s industrial component may drag prices lower.

3. Technical Breakdown Risk

If silver breaks below $63, it could open the door to a deeper decline toward the next support levels around $60 or even $58.

Investor Sentiment: Cautious but Opportunistic

Market sentiment toward silver right now is mixed but leaning toward cautiously optimistic. Many investors see the drop to $64.06 as a potential buying opportunity, especially for long-term holdings. Short-term traders, however, remain cautious due to market volatility and uncertainty in global economic trends.

On investment forums and analyst reports, one common theme emerges: the next few weeks will be crucial. How silver reacts around the $64 level will likely determine the direction for the next quarter.

What to Watch in the Coming Weeks

To understand where silver may head next, investors should keep an eye on:

Federal Reserve interest rate announcements

US dollar index (DXY) performance

Geopolitical events affecting safe-haven demand

Global manufacturing and industrial output reports

Silver ETF flows, which indicate investor confidence

If these indicators show signs of easing pressure, silver could mount a strong recovery.

Conclusion: Is a Market Reversal Likely?

Silver’s drop to $64.06 has created uncertainty — but also opportunity. While bearish forces remain, there are solid reasons to believe the market could rebound from this key support level. If the global economic landscape becomes more supportive and safe-haven demand increases, silver may regain strength.

However, until a clear breakout or breakdown occurs, silver is likely to remain in a volatile range. For investors, patience and careful analysis will be essential.

The next major price move could define the trend for the rest of 2026.