Silver price prediction: Will supply squeeze persist? XAG/USD gains 6.39% to $109.57

Traders Union
All News
Financial News
Silver surges 6.39% to $109.57 today

Highlights

Silver (XAG/USD) trades at $109.57, well above MA-20 ($90.53), MA-50 ($77.69), and MA-200 ($52.51), confirming a strong bullish trend across all timeframes.
Momentum indicators including MACD, ADX, and Awesome Oscillator signal strong buyer control, while intraday action shows high volatility and persistent strength toward session highs.
Despite overbought conditions (RSI 77.18, Stoch RSI 97.27, CCI 143.99), expected range for the next five days is $108.00–$111.00, with an 80%+ probability of further appreciation unless reversal below $108.00 occurs.

Industrial demand surge and supply pinch propel silver rally

Silver's rally is being driven by heightened industrial demand, particularly from the solar panel sector, along with substantial supply constraints and concerns over dollar devaluation. In addition, a notable depletion of COMEX silver inventories by 114 million ounces since October has intensified upward momentum, fueled by increased retail and institutional buying. Central bank purchases and ongoing global economic uncertainty are also supporting bullish sentiment for XAG/USD.

Upward drive persists as overbought signals prompt caution

Momentum remains robust, with confirmation from the MACD and Average Directional Index, both indicating strong buyer control. However, several key oscillators such as the RSI at 77.18, Stochastic RSI at 97.27, and Commodity Channel Index at 143.99 show clear overbought conditions. Bull/Bear Power is deeply positive, reflecting persistent buyer dominance, while the Awesome Oscillator affirms strong upward momentum. Following a modest gap up between the previous close ($102.99) and today's open ($103.28), price action surged to the session high at $110.06, evidencing high intraday volatility and strong demand, but stretched oscillators suggest that caution is warranted.

Breakout risk elevated as consolidation likely within volatility band

For the coming five trading days, the expected price range is $108.00 to $111.00, representing a typical volatility band relative to current levels. The probability of continued appreciation is very high (over 80%), supported by unanimous Buy signals across weekly and daily RSI, MACD, ADX, and Moving Averages. The baseline scenario points to consolidation within this corridor, while a bullish case would see a breakout above $111.00 on sustained momentum. A bearish reversal below $108.00 would likely require profit taking sparked by overbought conditions or a marked sentiment shift.

Viktoras Karapetjanc, expert at Traders Union, believes the fundamental drivers behind silver’s rally are robust. He sees industrial demand, central bank buying, and supply tightness supporting sustained gains. Macro sentiment is constructive, and technical signals confirm buyer control. However, overbought oscillators suggest some caution near highs. "With momentum strong and fundamentals aligned, I expect silver to consolidate above $108.00 and see any dips as potential opportunities to add long positions."

Previously it was reported that silver is exhibiting strong bullish momentum, decisively trading above all major moving averages and supported by robust technical indicators, including elevated MACD, ADX, RSI, and CCI readings signaling overbought conditions. Bullish sentiment is reinforced by persistent physical demand and tightening supply, with immediate support near $87.75 and resistance emerging at the $110 level amid elevated volatility.

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

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.