Silver price prediction: Will supply strain spark more gains? XAG/USD stays above $118

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Silver jumps 3.45% to $118.55 today

Highlights

Spot silver demand has surged as investors seek safe-haven assets amid heightened geopolitical tensions and U.S. government debt concerns.
Inventory coverage for silver futures has dropped to 14%, indicating a significant supply strain despite recent net selling through COMEX and ETFs.
Silver (XAG/USD) is trading at $118.55, significantly above MA-20 ($96.10), MA-50 ($81.01), and MA-200 ($53.70), confirming strong short- and long-term bullish momentum.

Safe-haven inflows boost demand as inventories tighten and selling persists

Spot silver demand has surged due to increased investor interest in safe-haven assets amid heightened geopolitical tensions and concerns about U.S. government debt. Inventory coverage for silver futures has dropped to 14%, reflecting strain in available supply. Recent data also indicate investors have been net sellers of silver through COMEX and ETFs over the past month.

Momentum stays bullish as overbought signals raise pullback risks

Technically, XAG/USD remains well-supported above key moving averages, with the nearest dynamic support at the Ichimoku Kijun level of $95.58 and additional support at the MA-50 around $81.01. Momentum is robust, with both MACD and ADX signaling a strong bullish trend, and the ADX highlighting a highly directional market. However, overbought signals are evident across RSI (84.91), Stochastic RSI (100.00), and CCI (160.63), indicating stretched conditions and increased risk of near-term pullbacks. Bull/Bear Power is deeply positive at 15.48, and the Awesome Oscillator confirms the prevailing uptrend.

Upside favored as volatility band limits short-term declines

Over the next five trading days, XAG/USD is expected to trade between $112.00 and $122.00, reflecting a volatility band relative to current levels. The likelihood of further upside remains very high (over 80%) given technical strength, though a consolidation within this range is the baseline scenario. A breakout above $122.00 may occur in a continued bullish scenario, while profit-taking could drive the price down toward dynamic support near $112.00 before buyers step in.

Viktoras Karapetjanc, expert at Traders Union, sees robust upside momentum in XAG/USD driven by persistent safe-haven demand and supply constraints. He notes that macro factors, especially concerns over U.S. government debt and heightened geopolitical tensions, are supporting strong investor sentiment. Technicals are stretched, but the analyst believes the risk of a major reversal remains limited in the near term. Karapetjanc expects price action to remain within the $112.00–$122.00 band, with bullish momentum dominant. "Silver’s strong fundamentals and macro backdrop give me confidence that further gains are likely as long as the risk environment remains elevated."

Previously it was reported that silver demonstrated a strong bullish structure, trading significantly above its key moving averages with robust momentum as indicated by high MACD and ADX readings. Despite persistent overbought signals from multiple oscillators and elevated volatility, the asset remained well-supported near $94.82, with immediate resistance at the $115 level.

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.