Silver (XAG) Forecast: Silver Rally Rebuilds—Will Prices Push for a New High by the Close?

Silver Extends Rally but Pulls Back After Record Highs

Spot silver traded higher on Tuesday but eased from a fresh record at $70.68 as traders locked in gains before Wednesday’s limited session and Thursday’s Christmas holiday.

Prices hovered near $69.38 mid-morning as the market reassessed whether the latest move signaled exhaustion or simply a pause in an otherwise powerful advance. Strong industrial and investment demand, tightening inventories, geopolitical tensions, and continued expectations for additional U.S. rate cuts had driven the move through $70 earlier in the session.

At 16:43 GMT, XAGUSD is trading $70.33, up $1.27 or +1.84%.

Profit-Taking Follows Strong U.S. Growth Data

The reversal began after a U.S. GDP update complicated the broader rate outlook. The delayed report showed the U.S. economy expanded 4.3% in Q3, well above the 3.2% forecast. Consumer spending rose 3.5%, exports strengthened, and corporate profits surged by $166.1 billion.

Inflation readings were mixed but still above the Federal Reserve’s preferred levels, with the PCE index rising 2.8% and core PCE at 2.9%. The stronger growth backdrop raised doubts about the timing and pace of potential Fed cuts in 2026, encouraging traders to lighten silver exposure after the record print.

Rising Yields Add Pressure to Precious Metals

U.S. Treasury yields pushed higher as markets prepared for a holiday-shortened week and several major auctions. The 10-year yield moved to 4.186%, the 2-year climbed to 3.544%, and the 30-year held near 4.846%.

Higher yields reduced interest in non-yielding assets such as silver, reinforcing the intraday pullback. Fed commentary added to that pressure after Cleveland Fed President Beth Hammack stated that rates should remain unchanged for months as inflation concerns still outweigh labor-market softness.

Key Auctions Offer Insight Into Investor Positioning

The Treasury will conduct a $70 billion 5-year auction on Tuesday followed by a $44 billion 7-year sale on Wednesday. These events arrive as investors weigh signs of easing inflation against uncertainty over early-2026 policy moves. Bond markets will close early Wednesday at 19:00 GMT and remain shut Thursday for Christmas, keeping liquidity thin and positioning cautious across metals and rates.

Short-Term Market Forecast: Bullish but Highly Sensitive to Yield Moves

Silver remains structurally supported by strong physical demand and constrained inventories, and a move through $70.68 would signal a renewed advance. However, Tuesday’s pullback introduces the risk of a daily closing price reversal top.

If confirmed, sellers could press the market toward the short-term pivot at $65.74. Over the next several sessions, the outlook tilts modestly bullish, but momentum hinges on whether yields continue to firm. A steady-to-softer tone in U.S. rates would likely restore upside interest, while further yield strength may extend profit-taking into early next week.

More Information in our Economic Calendar.