Silver Price Forecast: XAG/USD keeps the bullish vibe above $32.50
- Silver price gains ground to near $32.70 in Monday’s Asian session, up 0.45% on the day.
- The positive view of Silver prevails above the key 100-day EMA with the bullish RSI indicator.
- The first upside barrier is seen at the $33.35-$33.40 region; the initial support level is located at $31.52.
Silver price (XAG/USD) drifts higher to around $32.70 during the Asian trading hours on Monday. The weakening of the US Dollar (USD) provides some support to the USD-denominated commodity price. Furthermore, the uncertainty and concerns over US President Donald Trump's tariff plans might boost the safe-have flows, which contribute to Silver’s upside.
According to the daily chart, the bullish outlook of the white metal remains in place, with the price holding above the key 100-day Exponential Moving Average (EMA). The upward momentum is reinforced by the 14-day Relative Strength Index (RSI), which stands above the midline near 64.40, suggesting the path of least resistance is to the upside.
The upper boundary of the Bollinger Band and the high of February 14 of $33.35-$33.40 act as an upside barrier for Silver price. Sustained trading above this level could expose $34.55, the high of October 29, 2024. Any follow-through buying above the mentioned level could see a rally to $34.87, the high of October 22, 2024.
On the flip side, the initial support level for XAG/USD emerges at $31.52, the low of February 12. Extended losses could see a drop to $30.90, the 100-day EMA. The next contention level is seen at $30.70, the lower limit of the Bollinger Band.
Silver price (XAG/USD) daily chart
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.
Author
Lallalit Srijandorn
FXStreet
Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.
