Silver (XAG) Forecast: Silver Rally On Hold — Breakout Hinges on Dollar and Gold

Silver Pauses Near Resistance as Traders Watch Fed, Dollar and Gold Moves

Spot silver is holding firm just below resistance at $47.83 on Thursday, tracking gold’s strength and a weakening U.S. dollar. The market remains within yesterday’s range — a sign of temporary indecision, but also a setup for potential volatility as traders await direction from broader inputs.

At 11:46 GMT, XAG/USD is trading $47.53, up $0.21 or +0.44%.

Federal Reserve Uncertainty Fuels Precious Metals Rally

The U.S. government shutdown has halted key economic data releases, including jobless claims and Friday’s nonfarm payrolls. In the absence of official reports, markets are leaning heavily on private sector data and technical cues. Wednesday’s ADP print showed a surprise 32,000 job drop in September — its second straight monthly decline — reinforcing expectations for a Fed rate cut at the next FOMC meeting.

As a result, Treasury yields dipped, with the U.S. 10-year at 4.094%, and the 2-year steady at 3.545%. The rate repricing helped gold push toward record highs, lifting silver along with it as both benefit from falling real yields and increased speculative interest.

Gold Surge Draws Inflows, Lifts Silver as Collateral Beneficiary

Goldman Sachs reaffirmed its long gold call, pointing to growing ETF inflows and speculative positioning. SPDR Gold Trust holdings rose 0.59% on Wednesday, hitting 1,018.89 metric tons — a 14-month high. The gold rally has naturally supported silver, with traders viewing the white metal as a high-beta play on gold’s direction.

With gold testing its all-time high near $3895.50, the path to $4000 appears increasingly viable if dollar weakness persists. The U.S. Dollar Index is teetering near critical support at 97.412. A clean breakdown could open the door for metals to extend gains.

Industrial Demand Underscores Bullish Silver Outlook

Beyond gold tailwinds, silver’s fundamentals remain solid. Industrial demand from the electric vehicle and solar sectors — especially from China — continues to underpin prices. Supply-side support is also strong, with silver in its fifth consecutive annual deficit, adding structural bullish pressure.

Technical Setup: Watch $47.83 for Breakout or $46.82 for Reversal

Technically, silver needs to break through $47.83 with conviction to confirm the next leg higher, targeting $49.81–$50.00. On the downside, the nearest support is $46.82. A move below this level exposes $45.81, with further weakness pointing to $44.22.

Short-Term Outlook: Silver bulls are in control, but momentum hinges on a clean breakout above $47.83. If gold clears $3895.50 and the dollar slides further, silver could accelerate toward $50.00. Caution is warranted if support at $46.82 fails — that would shift the near-term trend lower.

More Information in our Economic Calendar.