Silver prices climbed on Thursday, with bullish traders eyeing last week’s high at $33.39. Breaking this level could ignite a surge towards resistance between $34.87 and $35.40, setting up the metal for potentially significant gains.
Support is strong at $32.53, with a critical pivot at $31.81. The metal’s intermediate and long-term technical trends remain positive, with the 50-day and 200-day moving averages situated at $30.79 and $30.48, respectively.
The Federal Open Market Committee (FOMC) recently opted to hold rates steady at 4.25% to 4.5%, citing inflation risks from Trump’s economic policies. With the Fed showing reluctance to cut rates, interest-bearing assets may lose appeal, drawing more investor interest to non-yielding metals like gold and silver. Additionally, discussions around pausing the quantitative tightening (QT) program could enhance market liquidity, a scenario that historically benefits precious metals.
Inflation Fears and Tariff Uncertainty Drive Demand
Trump’s aggressive tariff strategies, including potential new tariffs on lumber, cars, semiconductors, and pharmaceuticals, are fueling fears of a global trade war. These actions threaten to drive inflation higher, reducing the purchasing power of fiat currencies. As a result, both gold and silver are gaining traction as hedges against currency devaluation and market volatility.
Market Outlook: Silver Eyes Breakout if Gold Maintains Strength
With gold’s bullish momentum aiming for the $3,000 mark, silver could follow suit if market conditions remain favorable. A break above $33.39 would reinforce the uptrend, potentially targeting $35.40. However, traders should watch for any signs of a reversal in gold, which could prompt a short-term pullback in silver as well. For now, inflation concerns and geopolitical risks continue to support a positive outlook for the silver market.