Silver (XAG) Daily Forecast: AI and Green Energy Drive Demand Above $30.63 Pivot

Market Overview

Silver prices (XAG/USD) held steady around $30.67 per troy ounce on Wednesday, supported by expectations of rising demand in the months ahead.

Key drivers include anticipated Federal Reserve rate cuts, increased infrastructure spending during an economic slowdown, and growing usage of silver in advanced technologies such as artificial intelligence (AI) and solar energy.

Historically, silver has shown strong performance during rate-cutting cycles. Peter Krauth, author of The Great Silver Bull, highlights that silver prices have surged by an average of 332% during the last three such cycles.

“Rate cuts often stimulate economic activity, and silver, being a critical industrial and investment metal, benefits significantly,” Krauth said.

Silver Demand Tied to AI and Green Energy Transition

Krauth also noted that silver is pivotal in emerging sectors like electric vehicles (EVs), solar energy, and AI-driven technologies. The expanding green energy transition, which heavily relies on silver for solar panels and EV charging stations, is expected to amplify demand further.

AI advancements, particularly the rise of data centers requiring significant energy, could also drive silver demand as solar power becomes essential for sustainable energy solutions.

Moreover, infrastructure investments tied to recession recovery efforts are likely to support silver’s price growth.

Krauth emphasized, “Government spending on infrastructure during recessions typically boosts silver demand as it is widely used in industrial applications.”

Geopolitical Developments Ease Safe-Haven Demand

Geopolitical factors have tempered silver’s rally. The announcement of a ceasefire agreement between Lebanon and Israel, coupled with Scott Bessent’s nomination as Treasury Secretary under President-elect Trump, reduced economic fears and softened demand for silver as a safe-haven asset.

Despite this, lingering concerns around the Russia-Ukraine conflict and proposed U.S. tariffs on imports from China, Canada, and Mexico continue to provide support for silver prices. Trump’s tariff threats have added to market uncertainty, reinforcing silver’s appeal as a protective investment.

Silver saw a slight gain of 0.18% on Tuesday, trading at $30.36. However, easing geopolitical tensions may limit further safe-haven flows, with investors shifting focus to its industrial demand and macroeconomic drivers.

Short-Term Forecast

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver is trading at $30.56, down 0.42% on the day, as the market tests a critical pivot point at $30.63. On the 4-hour chart, immediate resistance is seen at $30.88, with additional hurdles at $31.16 and $31.45. A break above $30.63 could shift momentum toward the upside, especially with the 200 EMA aligned at $31.16 reinforcing this key level.

On the downside, support is firm at $30.27, with further levels at $29.99 and $29.68 providing a safety net for bearish scenarios.

Technical indicators show mixed signals, with the 50 EMA hovering slightly above the current price at $30.66, keeping the bias cautious. Traders should monitor the double-top pattern near $30.63, as it signals potential resistance.