Silver (XAG) Forecast: Bulls Eye Breakout Above 50-Day With Gold Lending Support

Silver Holds the Line But Faces Technical Test

Silver prices are treading water on Tuesday, consolidating in a tight range as traders take their cue from gold. While the broader bullish structure remains intact, technical resistance at the 200-day moving average is capping upside momentum. With gold showing signs of a potential pullback, silver bulls may need stronger conviction to break out.

At 10:21 GMT, XAG/USD is trading $32.33, down $0.03 or -0.08%.

Key Technical Levels in Focus

Silver is currently holding above the key Fibonacci retracement level of $32.19. This level aligns with the 61.8% retracement of the previous move and has provided solid near-term support. However, upside attempts are stalling at the 200-day moving average of $32.51. A close above this level would suggest stronger buyer commitment and could open the door to a move toward $34.59–$34.87, a critical resistance zone that marks a likely profit-taking area.

On the downside, a break below $32.19 would signal potential weakness. That could open the path to the 50% retracement level at $31.45. Continued selling could take the metal down to $30.94, which is also a 200-day average support from a longer-term view. These levels are crucial for traders managing risk on either side.

Gold Remains the Primary Driver

Gold’s influence on silver is currently outsized. After reaching a record high, gold posted a bearish closing price reversal on Monday. The pattern won’t be confirmed unless gold drops below $3193.63, but it’s enough to introduce some caution. Rate cut expectations and trade war headlines are keeping safe-haven interest alive, but short-term profit-taking in gold could spill into silver unless fresh catalysts emerge.

Industrial Demand and Trade Developments in Play

Physical demand from China remains a supportive factor for silver, especially given its dual role as a precious and industrial metal. Ongoing discussions about tariff easing and supply chain reshoring are also being watched closely. If positive developments emerge, they could lift industrial demand expectations and support the metal.

Silver Outlook: Cautiously Bullish with Breakout Potential

As long as silver holds above $32.19, the broader setup favors buyers. But the market needs a clean break above $32.51 to kick off the next leg higher toward $34.59. A failure at support would put $31.45 and potentially $30.94 on the table. Traders should watch gold for directional clues, but silver’s setup is developing its own breakout potential if momentum returns.

More Information in our Economic Calendar.