Adjustment phase of the undervaluation, the $63 psychological level holds... Easing of monetary policy and geopolitical risks are supporting the bottom.

From Surge to Pullback, XAG/USD Is Taking a Breather Near $64

Silver(XAG/USD) has fallen to around $64.95 during Asian trading hours. This follows the all-time high in the previous session, with selling pressure emerging to realize short-term profits. However, most analysts interpret this correction not as a trend reversal but as a natural rebalancing phase within the ongoing rally.

Despite the short-term decline, there is a high likelihood that silver prices will not easily break below the technical support levels of $61–$63. This is because the current structure, with expectations of monetary easing and geopolitical uncertainties, is limiting further downside.

Signals from November Inflation Data: The Fed’s Rate Cut Door Opens Wider

Recent U.S. inflation data has provided new interpretative angles for the market. According to the U.S. Bureau of Labor Statistics(BLS), November CPI rose 2.7% year-over-year, significantly below the expected 3.1%. More notably, the core CPI, which is less volatile, recorded a 2.6% increase, below the consensus of 3.0%, marking the lowest rise since 2021.

As inflation slowdown becomes more evident, the Fed will have more justification to expand rate cuts to respond to a weakening labor market. Lower interest rates reduce the opportunity cost of precious metals like silver, which do not generate interest income, making them relatively more attractive. This provides a theoretical basis for silver prices to firmly defend the downside in the $63–$65 range.

Rising US-Venezuela Tensions Boost Safe-Haven Demand

Another supporting factor stems from international political developments. According to The New York Times, the Venezuelan government has reportedly ordered naval escorts for oil tankers. This is seen as a response to the Trump administration’s ongoing “blockade” policy against Venezuela’s oil industry, signaling an increased risk of conflict between the U.S. and Venezuela.

When geopolitical uncertainties escalate, capital typically flows from stocks and high-yield assets into safe-haven assets like silver and gold. This safe-haven preference is likely to act as a structural support, preventing silver prices from falling below the psychological level of $63.

Ultimately, the Correction Is a Technical Signal, the Trend Remains Upward

In summary, the current phase of XAG/USD involves unavoidable profit-taking corrections around the $64–$65 range. However, three structural factors—expectations of monetary easing, weak employment data, and geopolitical risks—are acting as cushions to prevent a sharp decline below $63. From an investor’s perspective, this correction is widely viewed as an opportunity to re-enter the market.