Silver (XAG) Forecast: Silver Going Up as Iran Risks Rise—How Long Can Momentum Last?

Silver’s Impressive Rally Puts the Most Important Level on the Chart Within Reach

Last week’s rally in Spot Silver (XAGUSD) was impressive because it solidified support at $74.99 to $74.63 and overcame minor resistance at $83.61. It also put the market in a position to challenge the most important area on the chart, the $92.87 to $99.66, 50% to 61.8% retracement zone. Until it overcomes this area, we’re still looking at an elongated topping formation.

Traders Are Finding Value but a Support Base at $83.61 Would Signal Real Buying

It was important to see traders bidding the last two weeks around support. That tends to indicate traders have found value. There were even some offers being taken on Friday, which is always impressive. This week, it would be nice to see a support base built at $83.61 before an attempt to challenge $92.87, because that would signal real buying rather than just short-covering. To put it another way, overtaking $83.61 is good, but establishing a higher support base at this price before rallying will be better.

Geopolitics Is the Primary Driver as Iran Tensions and Trump’s Military Deadline Loom

As far as what’s driving the short-term bullish price action and volatility, I see mostly geopolitics at work and a little uncertainty over the tariffs. The geopolitical situation in the Middle East is pretty clear. We saw that early last week when headlines mentioned problems with the negotiations between the United States and Iran and President Trump’s 10-to-15-day window for the start of a possible attack by the U.S. Navy.

Tariff Ruling Is Still a Toss-Up and Its Impact on Silver Is Overstated

The Supreme Court ruling on the legality of Trump’s tariffs and his new 15% tariff is still a toss-up. Last year at this time, headlines were calling for large jumps in inflation before Trump implemented tariffs in April 2025. On Friday, this argument seems to have resurfaced. I don’t think the tariff ruling and the new tariffs will have a lasting impact on silver prices per se, but if they do, it will only be to the extent that they impact Fed policy.

What Are Analysts Really Saying? The Tariff-Silver Connection Doesn’t Add Up

Today’s price action is a good example of how traders are viewing the tariffs and silver. The price is up, that’s pretty clear, but some analysts are saying it’s up because of uncertainty over the tariffs. Frankly, I’m not sure what that means. If they said the Supreme Court’s decision on tariffs and President Trump’s new 15% tariff would have a positive or negative impact on Fed policy, I would understand it a little better.

Fed Rate Cut Odds Below 50% and Not an Especially Bullish Signal for Silver

What I am seeing is that the CME FedWatch Tool is at 45.4% for a rate cut in June. That’s less than 50%, which isn’t an especially bullish indicator for silver.

Bottom Line: It’s About Iran and We’ll Know the Answer by Thursday or Friday

The tariff story is not the bullish event driving prices higher, and the chances of a Fed rate cut aren’t a key factor either. This leads me to believe it’s about the geopolitics surrounding the United States and Iran. We should know by Thursday or Friday whether a new nuclear deal is in place or a war is about to start.

More Information in our Economic Calendar.