Silver Price Forecast: XAG/USD bulls defend uptrend as RSI cools, eyes breakout above $53.77
- Silver extends its record-breaking rally, fueled by a deepening supply crunch in London’s physical market.
- Spot prices hover near $52.50, up over 2.5% on the day, as investors return to the metal after a brief pullback.
- The broader bullish structure remains intact as the RSI eases from overbought territory, hinting at a short-term pause in momentum.
Silver (XAG/USD) extends its record-breaking advance on Wednesday, trading near $52.60 and up over 2.50% on the day after erasing the previous day’s losses. On Tuesday, Silver posted a fresh all-time high near $53.77 before a sharp pullback triggered brief profit-taking, snapping a four-day winning streak.
The white metal continues to benefit from persistent physical tightness in the London market, where inventories have plunged to record lows, fueling an aggressive short squeeze. This means there’s simply not enough physical Silver to meet demand. Borrowing costs and lease rates have surged as refiners and ETF custodians rush to secure a limited supply, driving prices even higher.
The situation has created a rare gap between London spot and US Comex futures prices. Analysts warn that the London market is operating under severe stress, with some calling it “on the brink of seizure.”
In a recent forecast revision, Bank of America now expects Silver to reach $65 per ounce by 2026, citing deepening structural deficits and continued investor demand. HSBC, meanwhile, lifted its 2025 average price forecast to $38.56 from $31, pointing to tight supply and resilient industrial consumption in key sectors such as solar, electric vehicles, and semiconductors.
-1760533821322-1760533821324.png)
From a technical perspective, the broader uptrend remains firmly intact, supported by a clear pattern of higher highs and higher lows. On the 4-hour chart, prices remain comfortably above the short-term moving averages, keeping the bullish bias intact. Immediate support is seen around $51.50, which closely aligns with the 21-period Simple Moving Average (SMA), followed by the $50.00 psychological level reinforced by the 50-SMA. Each minor pullback continues to attract fresh buying interest, suggesting strong dip-buying appetite as traders position for the next leg higher.
The Relative Strength Index (RSI) has eased from overbought territory to around 64, signaling a brief cooldown in momentum after the record run, with bulls likely taking a breather before attempting another push higher. On the upside, resistance is seen at the all-time high near $53.77, and a clear break above this zone could open the door toward the $55.00 handle, taking Silver deeper into uncharted territory.
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
Artigos Recomendados
