Next wave of silver price growth will reach 33 level

The first half of last week was marked by a sharp rise in silver prices. They added 5.3%, rising above the level of 32.7. In recent days, the prices moved to a correction, but its scale compared to the past wave of growth is very modest. The long lower shadows of the candlesticks on the daily chart indicate a stable buying of the big dips in the silver market. Thanks to the bulls, the current downward movement may be limited to the level of 32, and then the prices of the metal will head towards 33 and the highs of February.

Precious metals prices are supported by the weakening of the dollar. Last week, the US currency fell more than 3% against major rivals, showing the worst result since November 2022. Demand for the US currency is declining as the economy slows down, and on Friday there was another confirmation of this process. The unemployment rate at the end of February returned to the December mark of 4.1% and may continue to grow on the background of mass layoffs of civil servants.

Ole Hansen from Saxo Bank urges investors to pay attention to silver due to the intentions of Germany and other European countries to sharply increase spending. Industrial demand for silver may accelerate, while supply is unlikely to do the same. As silver reserves are depleted, the problem will become more urgent.

In an interview with Kitco Mining, investor Eric Sprott gave a forecast for silver prices to rise to the range of $250–500 per ounce. He believes that the current gold-to-silver ratio, which is about 90 to 1, is distorted due to market manipulation and should drop significantly to 15 to 1 or even 7 to 1. These expectations are for the long term, and for 2025, Sprott cites the $50 level as the target.

The Stochastic indicator shows that silver prices correction is incomplete. It is better to open long positions at lower levels, for instance near level 32.

Consider the following trading strategy:

Buy silver near the level of 32. Take profit – 33. Stop loss – 31.4.