Silver is rising today: what traders are watching (January 26)

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Silver Surges 6.39% to $109.57 Today

Highlights

Retail investment demand for physical silver has surged, driving a speculative market environment amid ongoing supply constraints and robust interest in small bars and coins.
COMEX silver inventories have declined by 114 million ounces since early October, indicating heightened physical demand and tighter available supply.
Silver (XAG) trades at $109.57, well above key moving averages, with bullish momentum likely to persist unless support at $108.16 is breached or resistance at $110.06 is broken.

Physical demand spike and tightening supply shift investor sentiment

Recent developments in the physical silver market show a surge in retail investment demand and a notable reduction in COMEX inventories, which have decreased by 114 million ounces since early October. Interest remains high in small bars and coins, with market activity described as speculative amid heightened physical demand. Supply constraints and investor behavior are key factors shaping current sentiment.

Anton Kharitonov, expert at Traders Union, questions the sustainability of this rally in silver. He notes that although price sits well above the key moving averages, RSI and CCI point to clear overbought risks. Kharitonov cautions that heavy speculative demand and deepening supply constraints may be distorting price discovery. He sees further upside as possible but believes a sharp pullback could come swiftly if sentiment shifts or inventories recover. "Traders should avoid complacency — overextended runs and volatile positioning make silver vulnerable to an abrupt reversal."

Viktoras Karapetjanc, expert at Traders Union, sees a robust backdrop for silver. He highlights the strong physical demand and significant drop in COMEX inventories as clear bullish drivers. Karapetjanc points to the decisive move above long-term averages, which signals that the bullish structure remains intact. He expects the market to offer multiple setups for continuation trades if $110 yields. "With investment flows and physical supply tightening, further growth is likely and the rally still has room to run."

Jainam Mehta, market strategist, observes momentum strength but notes a tactical risk as short-term indicators flash overbought. He sees a possible consolidation phase between $108.16 and $110.06 if the market pauses. Mehta suggests traders watch for a clean breakout above resistance or reversal signals near support for new entries. "A quick move above $110.06 could trigger fresh momentum, but fading overbought signals at these levels may offer tactical short setups too."

Overbought conditions intensify as bullish signals test resistance

The nearest dynamic support for XAG is near the Ichimoku Kijun at $87.75, while resistance is now mapped to the next round level at $110, just above today’s session highs. Momentum signals remain firmly bullish, with MACD and ADX supporting strength and trend continuation, and RSI and CCI both confirming overbought daily and weekly conditions. Stochastic RSI and BBP also indicate extended buying, as bull power dominates intraday movement but signals risk for a short-term pause.

Previously it was reported that silver is trading in a strong bullish trend above all major moving averages, with elevated momentum indicated by the RSI near 68 and support holding at the $108 level. Near-term price action is guided by resistance at $110–$112, with the market structure showing higher highs and higher lows, though consolidation and increased volatility are possible as the rally matures.

Source of Data: XAG Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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