- Silver attracts some dip-buying following the overnight pullback from a one-month peak.
- The technical setup seems tilted in favor of bulls and supports prospects for further gains.
- Dips towards the $29.20 confluence hurdle breakpoint could be seen as a buying opportunity.
Silver (XAG/USD) regains positive traction during the Asian session on Wednesday and stalls the overnight modest pullback from the vicinity of the $30.00 psychological mark or over a one-month high. The white metal currently trades around mid-$29.00s and seems poised to prolong its recent goodish recovery from the lowest level since May touched earlier this month.
From a technical perspective, the emergence of dip-buying near the $29.20 confluence hurdle breakpoint– comprising the 50-day Simple Moving Average (SMA) and the 50% Fibonacci retracement level of the July-August slide – validates the positive outlook. Moreover, oscillators on the daily chart have been gaining positive traction and are far from being in the overbought zone. This, in turn, suggests that the path of least resistance for the XAG/USD is to the upside.
That said, the overnight failure near the $30.00 round figure makes it prudent to wait for some follow-through buying before positioning for a further near-term appreciating move. The XAG/USD might then climb to the $30.55-$30.60 area, or the 78.6% Fibo. level. The momentum could extend beyond the $31.00 mark, towards the $31.30-$31.40 supply zone en route to the July swing high, around the $31.75 region, the $32.00 level and the $32.50 area, or the YTD peak.
On the flip side, the $29.20 area might continue to act as an immediate strong support ahead of the $29.00 round-figure mark. A convincing break below the latter could make the XAG/USD vulnerable to accelerate the slide towards the $28.55 region, or the 38.2% Fibo. level, before eventually dropping to the $28.00 round figure. Failure to defend the said support levels might expose the $27.25 support and the next relevant support near the $27.00 mark.
Silver 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.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to recovery gains near 1.0950 on US Dollar weakness
EUR/USD is holding onto recovery gains near 1.0850 in European trading on Tuesday amid a broadly weaker US Dollar. The recovery in risk sentiment undermines the havem demand for the US Dollar, lifting the pair. Dovish Fed expectations also weigh negatively on the Greenback. Tariff updates eyed.
GBP/USD pares back gains toward 1.2750
GBP/USD is paring back gains to revisit 1.2750 in Tuesday's European session. The pair draws support from renewed US Dollar weakness and a positive shift in risk sentiment but US President Trump's tariff war and global growth concerns limit its upside.
Gold price climbs further beyond $3,000 amid trade jitters, renewed USD selling
Gold price builds on the previous day's late rebound from a nearly four-week low and climbs back above the $3,000 psychological mark heading into the European session on Tuesday. Persistent worries about an all-out global trade war help revive demand for the safe-haven bullion.
XRP battles tariff turbulence amid MVRV buy signal
Ripple seeks stability in a volatile crypto landscape influenced by macroeconomic factors, including reciprocal tariffs. The international money transfer token hit a low of $1.64 on Monday after opening the week at $1.92, representing a 14.5% daily drop.
Strategic implications of “Liberation Day”
Liberation Day in the United States came with extremely protectionist and inward-looking tariff policy aimed at just about all U.S. trading partners. In this report, we outline some of the more strategic implications of Liberation Day and developments we will be paying close attention to going forward.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.