Prices of silver, as well as other precious metals, were under strong selling pressure last week. Donald Trump's victory in the US presidential election resulted in a stronger dollar, and in the absence of further escalation of geopolitical tensions, demand for safe-haven assets decreased. Consequently, the white metal price was hit twice, but the bears are gradually reducing their activity. On Friday, despite the price drop, the local lows were not updated. This could be one of the signs of a near-term rebound.
The world's leading financial organizations keep expecting a new wave of growth in silver prices. Thus, the World Bank’s analysts encourage investors to shift their focus from gold to the white metal, predicting its increase in price by 7% in 2025 and by 3% in 2026. Silver demand will rise steadily over the next few years, driven by its popularity as both a financial instrument and an industrial raw material.
UBS experts also have a positive view on the outlook for the white metal. According to their estimates, the metal’s price will rise to $36–38 per ounce. In the long term, it is not excluded to reach $50. Julian Wee, a strategist at a Swiss bank, points to rising silver consumption in the technological and automotive sectors. Financial market participants are also contributing, with assets in silver ETFs increasing by 8.3% to 741 million ounces over the past 6 months.
Carsten Fritsch of Commerzbank draws attention to the new stimulus package for China's economy, enacted last Friday. In his opinion, the actions of China's authorities improve the outlook for silver demand. And while Trump's return to the White House may slow the pace of the transition to green energy, consumption of the white metal will continue to grow steadily due to demand in other industry sectors.
The RSI indicator on the daily chart of silver has not reversed upward yet, but its decline rate is clearly slowing down. It is possible to open long positions around the level of 30.8, while the nearest target for the bulls will be 32.5.
Consider the following trading strategy:
Buy silver in the range of 30.8–31.2. Take profit – 32.5. Stop loss – 30.
This content is for informational purposes only and is not intended to be investing advice.
