Silver Extends Rebound, Targets Key Psychological Levels Above $90

Key Moments

Technical Overview: Momentum Turns Constructively Higher

Silver (XAG/USD) has recovered from its previous decline and trades near $90.50 per troy ounce in early European trading on Wednesday. On the daily chart, the 14-day Relative Strength Index (RSI) stands near 56. It remains above the 50 midline and below overbought territory. Therefore, buying interest appears intact and may support further gains.

The price also trades above the nine-day and 50-day Exponential Moving Averages (EMAs), signaling a recovery phase after the earlier sell-off. Moreover, the nine-day EMA has turned higher and continues to diverge from the flatter 50-day EMA. This pattern points to improving short-term momentum rather than a fully established long-term uptrend.

Key Levels: Upside Barriers and Downside Supports

As long as XAG/USD holds above this moving-average cluster, the near-term bias remains cautiously positive. The next upside target is the $100.00 psychological barrier, which could act as a strong hurdle. Beyond that, focus shifts to the record high at $121.66 set on January 29. A sustained break above this level would signal a major bullish breakout.

On the downside, initial support sits near the rising nine-day EMA at $84.43. Below that, the 50-day EMA at $79.94 provides the next key floor. If price breaks below both levels, the current bullish structure would weaken. Consequently, the decline could extend toward the two-month low at $64.08 recorded on February 6.

XAG/USD: Daily Chart

(The technical analysis of this story was written with the help of an AI tool.)

Silver as an Investment Asset

Silver is a widely traded precious metal and serves as both a store of value and a medium of exchange. Although less prominent than gold, it helps investors diversify portfolios and hedge against inflation. Investors can access silver through physical holdings such as coins and bars, as well as Exchange Traded Funds that track its market performance.

Drivers of Silver Price Dynamics

Several factors influence silver prices. For instance, geopolitical tensions or fears of economic downturns can lift silver due to its safe-haven appeal, although usually less than gold. Because silver yields no interest, it often benefits from lower interest rates. In addition, its valuation closely tracks movements in the US Dollar, since silver is priced in dollars (XAG/USD). A stronger dollar typically weighs on silver, while a weaker dollar supports higher prices.

Other factors also shape price trends. These include investment demand, mining output, and recycling flows. Since silver is more abundant than gold, supply changes can have a notable impact.

Impact of Industrial and Jewelry Demand

Silver has extensive industrial uses, especially in electronics and solar energy. Its high electrical conductivity — higher than copper and gold — makes it essential in many applications. Therefore, rising industrial demand can push prices higher, while slowdowns tend to pressure the market.

Economic conditions in the United States, China, and India also play a key role. In the US and China, large industrial sectors consume silver in many processes. Meanwhile, in India, strong demand for silver jewelry can drive price swings.

Relationship Between Silver and Gold

Silver often follows gold’s direction. When gold prices rise, silver usually moves higher as well, reflecting their shared safe-haven roles. The Gold/Silver ratio — the number of ounces of silver needed to equal one ounce of gold — helps investors assess relative value.

A high ratio may suggest that silver is undervalued or that gold is overvalued. Conversely, a low ratio can indicate that gold is undervalued relative to silver.