Silver (XAG) Forecast: Silver Bounces, but Can It Sustain Momentum Above $31.81?

Silver Prices Edge Higher, Lagging Gold’s Rally as Key Pivot Holds

Silver prices are trading slightly higher on Tuesday but continue to lag behind gold’s stronger percentage gains. The market is currently testing a critical short-term pivot at $31.81, which could determine its next move. A sustained push above this level would open the door to $32.53, while a failure to hold could send prices back toward the 50-day moving average at $31.02.

At 13:45 GMT, XAG/USD is trading $31.81, up $0.12 or +0.39%.

Gold’s Surge Provides Support, but Silver Struggles for Momentum

Gold’s strong rally, driven by a weaker U.S. dollar and falling Treasury yields, is providing indirect support to silver. With gold testing key resistance levels and approaching record highs, silver is finding some buying interest. However, traders remain cautious, as silver’s price action lacks the conviction seen in gold.

Silver typically follows gold’s lead but has been slower to react. This divergence suggests that while silver benefits from the same macroeconomic conditions, it lacks the same safe-haven appeal that is currently driving gold higher. Instead, silver’s price movements are more influenced by industrial demand, which remains uncertain given global economic risks.

Macroeconomic Factors and Market Outlook

The broader macroeconomic environment remains favorable for precious metals. Treasury yields are declining, with the 10-year yield dipping to 4.168% and the 2-year yield falling to 3.931%, reducing the opportunity cost of holding silver. Meanwhile, the U.S. dollar index has dropped to 106.78, making silver more attractive to international buyers.

However, silver’s price action remains more dependent on industrial demand, which is still clouded by uncertainty surrounding global trade tensions. New tariffs imposed by the U.S. on Canada, Mexico, and China have raised concerns about economic slowdowns, which could weigh on silver’s industrial use.

Silver Market Forecast: Cautious Optimism

Silver’s immediate outlook depends on whether it can hold $31.81 and gain momentum toward $32.53. If gold continues its strong uptrend, silver could follow suit, but traders will be wary of any retracement back toward the 50-day moving average at $31.02.

For now, silver remains in a neutral-to-bullish posture, with upside potential if key technical levels hold. Traders should monitor macroeconomic developments, particularly any signals of Federal Reserve rate cuts, which could further support silver prices.

More Information in our Economic Calendar.