Silver is poised to test upper boundary of ascending channel

Silver has been trading upward for a while, hitting a 14-year peak due to a weaker dollar and expectations of further interest rate cuts by the Federal Reserve (Fed). The price reached a local high of $43.766, consolidating above $43.600 with significant trading volumes. This shows that quotes are set to test the upper boundary of the ascending channel.

The Chaikin Oscillator is a contributing factor to the current price dynamics. The indicator has been rising since September 17, confirming an accumulation of bullish momentum.

However, signs of technical overheating are emerging amid this surge. The Stochastic Oscillator (5, 3, 3, Simple) is forming a bearish divergence. Despite the price climbing to new highs, the %K line (46) crossed below the %D one (52), while the overall indicator kept declining, suggesting that growth momentum is slowly fading.

The upper boundary of the established channel serves as a key resistance for silver. The price has failed to break above the $44.100–$44.690 range since April. The quotes are now close to this area, which could trigger profit-taking and active selling among traders. The nearest support is at $41.100. A breach through this level may accelerate the bullion’s corrective movement toward $40.150, or the lower boundary of the channel.

Nevertheless, fundamentals remain positive for silver. Expectations of two more rate cuts by the Fed put additional pressure on the US dollar and raise investor appetite for precious metals as safe-haven assets. Concurrently, industrial demand remains strong, especially from the solar, electric vehicle, and electronics sectors. Despite the projected decline in silver consumption for solar panels due to record prices (according to BNEF), the shift to alternatives is still technologically limited, supporting a structural supply deficit.

Consider the trading plan below:

Buy silver amid its correction to support at $41.00. Take profit: $44.690. Stop loss: $40.150.

This forecast remains valid from September 22 to September 29, 2025.