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Silver (XAG) Forecast: Prices Surge After Breaking 200-Day Moving Average – $30.54 in Sight
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Key Points:
- Silver breaks above the 200-day moving average at $29.85, signaling bullish momentum with eyes set on $30.54 and $30.93.
- Gold stabilizes near the 50-day moving average at $2656.16, providing crucial insight into silver’s next price movement.
- Traders monitor rising Treasury yields and a weaker dollar as key drivers influencing silver and gold market direction.
- Industrial demand and potential Chinese stimulus could boost silver prices despite headwinds from elevated Treasury yields.
In this article:
Silver Prices Push Higher as Gold Holds Steady Near Key Resistance
Silver prices climbed on Monday, breaking above the 200-day moving average at $29.85, signaling potential for further gains. The market is tracking gold closely, with traders watching for signs that silver could test the next key level at $30.54. A continued rally may see prices advance toward the 50-day moving average at $30.93, reinforcing the bullish outlook.
The 200-day moving average remains the dominant technical level for silver, with a sustained move above this threshold driving positive sentiment. However, failure to hold this level could lead to a pullback toward $29.50, reflecting cautious trading at current prices.
At 15:52 GMT, XAG/USD is trading $30.09, up $0.48 or +1.61%.
Gold’s Stability Provides Insight for Silver’s Next Move
Gold prices held steady on Monday after early losses, as traders balanced rising U.S. Treasury yields with a weaker dollar. Gold is currently testing the 50-day moving average at $2656.16, a critical level that has capped rallies. A successful break above this barrier could push gold toward the $2663.51-$2693.40 retracement zone, with further resistance at $2726.30.
Gold’s stability provides a supportive backdrop for silver, as both metals often respond similarly to macroeconomic signals. Traders are eyeing upcoming U.S. economic data, including JOLTS job openings, ADP employment figures, and Friday’s nonfarm payrolls report. These indicators will shape market expectations regarding the Federal Reserve’s rate policy.
Dollar Weakness and Yields Drive Precious Metals
The U.S. dollar weakened by 1% after reports that President-elect Donald Trump may limit tariffs to critical sectors, alleviating fears of widespread inflationary trade policies. This reduction in inflationary pressure weighed on the dollar, indirectly supporting silver and gold.
However, rising Treasury yields, with the 10-year yield hovering near 4.634%, present a challenge. Persistent high yields diminish the appeal of non-yielding assets like silver, potentially limiting upward price movement unless economic data signals softening conditions.
Industrial Demand and Chinese Stimulus Remain Pivotal
Silver’s industrial demand continues to play a crucial role in price direction. Market participants are closely monitoring any signs of economic stimulus from China, as increased infrastructure and green energy projects could bolster physical silver demand. Industrial consumption remains a critical driver for silver prices, potentially offsetting pressure from rising yields.
Silver Outlook: Testing Key Levels with Gold in Focus
Silver’s performance this week will depend on its ability to sustain levels above $29.85. If support holds, traders are likely to target $30.54, with potential upside toward $30.93. Failure to maintain momentum could see prices slip back to $29.50, reinforcing the significance of technical levels.
Gold’s behavior around $2656.16 will provide critical clues for silver’s direction. Traders should remain attentive to economic data releases and yield movements, as these factors will shape short-term market action across precious metals.
More Information in our Economic Calendar.
About the Author
James Hyerczykauthor
James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.
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