Silver (XAG) Daily Forecast: Will China’s Trade Surplus Boost Silver Demand?

Market Overview

Silver prices have struggled to shake off a downward trend, hovering around $31.07 and touching an intraday low of $30.87.

Silver faces continued downside risks as the U.S. dollar strengthens, driven by market optimism following former President Donald Trump’s election victory.

With the dollar rallying, silver—a dollar-denominated asset—becomes pricier for overseas buyers, diminishing its appeal.

China’s Trade Surplus Adds Complexity to Silver’s Outlook

China’s expanding trade surplus, which rose to $95.27 billion in October—well above expectations of $75.1 billion—indicates robust global demand, especially for industrial goods.

Exports grew by 12.7% year-over-year, far exceeding the anticipated 5% rise, signaling resilient external demand that could boost silver’s use in manufacturing.

However, China’s imports fell by 2.3%, worse than the expected 1.5% decline, hinting at subdued domestic consumption.

The conflicting data keeps silver’s outlook neutral to slightly bullish, as industrial demand might lift prices, but weak internal demand in China may cap gains.

Fed’s Upcoming Rate Cut: A Potential Tailwind for Silver

Market expectations of a 25-basis-point rate cut by the U.S. Federal Reserve at its upcoming November meeting add a cautious tailwind for silver. The CME FedWatch Tool shows a 98.1% probability of the rate cut, reflecting strong investor consensus.

If the Fed eases policy, the U.S. dollar may weaken, potentially supporting silver prices as the metal becomes more affordable for international buyers.

U.S. Economic Resilience Poses a Headwind

Mixed economic data from the United States further complicates silver’s trajectory. The U.S. ISM Services PMI rose to 56.0 in October from 54.9, surpassing forecasts and underscoring the strength of the services sector.

However, the S&P Global Services PMI registered at 55.0, slightly below expectations, suggesting some slowing in service-sector growth.

The combined impact of resilient U.S. economic data and China’s mixed trade outlook keeps silver’s forecast balanced, with slight bullish potential.

Analysts remain cautious, noting that the Fed’s decisions and evolving global economic trends will likely shape silver prices in the near term.

Short-Term Forecast

Silver hovers near $31.07, with immediate support at $30.78, suggesting potential rebound. If buyers enter, resistance at $31.93 and $32.37 could test momentum shifts.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver is under some pressure, currently trading at $31.07, down 0.37% on the day. The price sits below its pivot point at $31.42, showing a bearish sentiment in the short term. However, immediate support around $30.78 could offer a base for a potential rebound, especially with the metal approaching oversold conditions.

Key resistance levels to watch are $31.93 and $32.37; if silver manages to break through these, it could signal a shift in momentum.

On the downside, a sustained drop below $30.78 would likely open the door for further declines, with support levels at $30.24 and $29.78. Given its position near a strong support zone, silver may be set for a short-term recovery if buyers step in.