Silver Price Forecast: XAG/USD targets further upside beyond $90.00; 100-SMA holds the key
- Silver scales higher for the third consecutive day and seems poised to climb further.
- The overnight breakout above the 100-hour EMA was seen as a key trigger for bulls.
- Any corrective pullback could be seen as a buying opportunity and remain limited.
Silver (XAG/USD) attracts buyers for the third straight day and climbs to over a one-week high, around the 90.00 psychological mark, during the first half of the trading action on Tuesday. Moreover, the supportive technical setup backs the case for a further near-term appreciating move.
The overnight breakout through the 100-hour Exponential Moving Average (EMA) was seen as a key trigger for the XAG/USD bulls and keeps the short-term uptrend intact despite the latest pullback. Moreover, the Moving Average Convergence Divergence (MACD) indicator eases but remains in positive territory, suggesting fading yet still positive upside momentum after an earlier impulsive leg higher.
Adding to this, the Relative Strength Index cools from overbought readings above 70 and steadies in the mid-60s, indicating that bullish pressure persists even as immediate upside traction moderates. A sustained move and acceptance above the $90.00 psychological handle would reaffirm the constructive outlook and pave the way for additional gains towards retesting the monthly swing high, around the $96.60-$96.65 area.
On the downside, initial support is located at $88.10, with a break lower exposing the former breakout area at $87.50, followed by stronger support around the $86.50 zone where recent consolidation began. A deeper decline would bring the 100-hour EMA near $85.15 into focus as a key defense for the broader bullish structure.
(The technical analysis of this story was written with the help of an AI tool.)
XAG/USD 1-hour 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
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
