XAG – Key Level for Silver: $49.40

Silver outperformed gold last week. Although it continued its downward trend at the beginning of the week, briefly dipping to a low of $45.51, a surge in buying pushed the price back up to a weekly high of $49.36, ultimately closing at $48.65.

Currently, silver prices are facing resistance from a double-layered resistance zone formed by the 25-day moving average at $49.20 and the November support level at $49.40. A break above this area is needed to open up further upside potential. The 50-day moving average at $45.40 coincides closely with last week's low, and this level has become support after the breakout of the three-year upward channel since 2021, making it technically significant. The 16.44% retracement from the recent high is the 0.382 Fibonacci retracement level, and silver prices are currently trading within the 0.236 to 0.382 range. The 4-hour chart shows a potential head and shoulders bottom pattern. A decisive break above the neckline at $48.80 would strengthen the short-term rebound momentum.

For gold/silver, gold needs to hold above $84.4 to regain relative strength; a sustained stay below this level suggests silver will maintain its independent strength or continue its sideways trading pattern.

If silver successfully breaks through the 25-day moving average at $49.20 and the monthly support level at $49.40, it could potentially test $50.50, and then challenge the previous highs of $51.20 and $52.15. Failure to break through the $49.40 resistance level could lead to a pullback to the $48 support level, with further downside targets at $46.75 and $45.45. In this scenario, the market may enter a prolonged consolidation phase, awaiting new fundamental drivers.

This week's trading strategy and key levels: Early trading suggests a range between $48 and $49.40; a breakout could be followed by a move in the direction of the breakout. Resistance levels are referenced at $49.95, $50.50, and $51.20. The support levels are referenced at $47.40, $46.75, and $45.45. Before a clear breakout above $49.40, it is advisable to maintain a small position for initial testing; after a breakout, positions can be added in batches, with a stop-loss set below 48.

The Federal Reserve cut interest rates by 25 basis points as expected in October, but expectations for a December rate cut have fallen from 91% to below 70%, increasing dollar volatility in the precious metals market. Supply and demand structure: Silver inventories on the London Metal Exchange have declined for three consecutive weeks, but demand from the photovoltaic industry remains resilient, providing underlying support for silver prices. Fund flows: CFTC data shows that net long positions in silver futures have decreased by 38% from their September high, indicating a healthier supply structure.

As the weakest performing precious metal last week, platinum exhibited a downward trend in January. Platinum prices initially dipped to a low of $1503 at the start of the week, before rebounding technically to a high of $1630. However, this upward momentum failed to hold, and the price closed at $1575, a weekly decline of 1.48%, significantly weaker than other precious metals.

Currently, platinum prices are constrained by the 25-day moving average at $1621, while the 9-day moving average has also moved down to $1589, forming a short-term resistance zone. Notably, while other commodities have reached new highs, platinum has consistently lagged behind, indicating low market attention and weak overall momentum.

Despite this weakness, a successful break above the aforementioned resistance levels of $1589/$1621 could present a technical rebound opportunity. Conversely, if the price fails to break through the moving average resistance, it is advisable to remain on the sidelines and wait for a pullback to a deeper support area before considering buying.

From a medium-term perspective, platinum is expected to fluctuate within a large range of $1500-$1892. In the short term, the price action is expected to be sideways, with the range for this week anticipated to be between $1510 and $1640.

London Silver November Forecast Range:
Resistance: 49.25 – 50.25 – 51.20 – 52.15
Support: 48.05 – 46.75 – 45.45 – 44.20

London Silver November 3-7 Forecast Range:
Resistance: 49.25 – 50.50 – 51.20 – 51.90
Support: 48.05 – 47.40 – 46.75 – 45.45

London Silver November 3
Forecast Early Range: 48.45 – 48.75
Resistance: 48.95 – 49.15 – 49.45 – 49.75
Support: 48.15 – 47.95 – 47.75 – 47.20

iShares Silver Trust Silver Holdings: October 20 – 15,769.78 tons
October 21 – 15,676.64 tons
October 22 – 15,597.61 tons
October 23 – 15,469.20 tons
October 24 – 15,419.81 tons
October 27 – 15,340.79 tons
October 28 – 15,209.57 tons
October 29 – 15,209.57 tons
October 30 – 15,189.82 tons
October 31 – 15,189.82 tons

Any questions? contact our professional analysis team