Exchange Traded Fund (ETF) inflows supported price movement, although not dramatically, while demand from Asia remained subdued amid continued buyer caution. Technical indicators show the next resistance levels for silver at $31.76 and $32.52, with potential gains towards $35.00 if momentum continues.
Geopolitical risks and a weakening dollar are sustaining gains
Geopolitical tensions, including escalating conflicts in Gaza and Ukraine, continue to strengthen silver’s appeal as a safe haven. Hezbollah’s involvement in the Middle East crisis increases the risk of broader regional instability, further supporting precious metals. Furthermore, the weakening of the US dollar has been a major factor, making silver more attractive to investors holding other currencies.
The broader macroeconomic environment is also providing a tailwind. Lower US Treasury yields and the Fed’s dovish stance strengthen investment opportunities for silver, which has risen more than 32% this year, outperforming other commodities.
Weekly Forecast: Silver Eyes $35 as Rate Cuts Loom
With silver firmly entrenched in an uptrend, traders will be watching closely for further rate cuts and economic data to drive the next leg of the rally. Soft U.S. economic data, including the latest retail sales and jobless claims, suggest more easing is on the horizon. This would strengthen the outlook for silver, potentially pushing it past the $32.52 resistance level towards $33.00 or even $35.00.
However, headwinds such as weakening retail demand in Asia and the possibility of reduced industrial demand from China could dampen the upward trend. In the short term, safe-haven demand for silver and the Fed’s dovish stance make a continued rally likely. Expect volatile but upside price action as traders look to take advantage of dips.