Silver prices jumped 4% on Friday and hit $38.5 per ounce for the first time since September 2011. Buyers kept up the momentum at the start of Monday’s trading session, pushing prices higher and testing the $39 level. After a month of consolidation, this sharp breakout is forcing bears to cover their short positions in a hurry. If momentum holds, silver could reach the key $40 threshold before profit-taking kicks in.
Analysts surveyed by Bloomberg attribute the surge in silver demand to Donald Trump’s threats to impose 50% import tariffs on copper starting August 1. Traders are now speculating which other goods might face tougher US trade restrictions. While precious metals haven’t been mentioned in Trump’s statements so far, market players are already bracing for a potential spike in silver imports to the US.
Meanwhile, analysts at Phillip Nova are pointing to the increasingly tough rhetoric from trade negotiators. This comes after the US president announced over the weekend that 30% tariffs on EU and Mexican imports will take effect next month. The move immediately boosted investor appetite for safe-havens, yet silver is clearly outperforming gold. The yellow metal is trading less than 5% below its all-time highs, while silver would still need to rally over 20% to reach its own record peak.
Silver is increasingly being viewed as a core portfolio element. According to a recent report by the Silver Institute, exchange-traded funds (ETFs) added 95 million ounces of the metal between January and June alone, already surpassing full-year 2024 inflows. Total ETF holdings now sit just 7% below their all-time high of 1.21 billion ounces, recorded in February 2021. With both investment and industrial demand providing solid support, silver prices continue their steady upward trend.
The RSI and Stochastic indicators both confirm a buy signal for silver. The next key target for the bulls is the $40 level.
Consider the following trading strategy:
Buy silver at the current price. Take profit – 40. Stop loss – 37.3.
This content is for informational purposes only and is not intended to be investing advice.
