Metal rally ignites: Silver surges back above $50 level

Metals attempt to retake their unforeseen 2025 run higher in today's wild session.

Higher than expected inflation, released on Oct 24 during to the BLS shutdown, brought back some calm in a squeezing metals market.

While Gold went from $4,380 to just below $3,900, marking a 10.80% correction, Silver moved even more sharply with a drawdown of 16%.

A comeback in the US Dollar and hawkish Fed repricings had severely hurt demand for metals.

However, this demand is now rapidly coming back as the yet-again pushed back government reopening is being priced for a Republican sweep, where more aggressive fiscal spending is widely expected to remain reckless.

This was one of the main proponent of the run in Gold and Silver throughout the beginning of the year.

Up about 4.50% as we speak, Silver is pressing its bullish momentum to close the opening session.

Let's dive into a multi-timeframe analysis from the Weekly to an intraday chart to spot where prices could be heading.

Read More:

• Gold (XAU/USD) Price Forecast: Bullish Breakout Gathers Pace as Fed Pivot Expectations Firm, $4250/oz Incoming?
• Why the end of the US shutdown sparks a huge rally in Stocks

As explained in our previous edition from a few weeks prior, the squeeze in Silver was so steep that many participants could not operate.

A run on the precious metal took its prices up close to 50% from Powell's Jackson Hole speech to its all-time highs ($54.48) in less than 50 days.

The consequent correction was deep but buyers nonetheless re-entered with force October 28th, right before the FOMC – The wick on the weekly candle created a bullish weekly hammer which promptly saw some follow through.

Failing to fill bids at the 50-week moving average, participants rushed in the market to not miss the ongoing rally which reinforced its strength; The metal is now up 10% from its $45.55 lows.

The current weekly candle is one of a bullish impulse which prompts further continuation – A test of the 2025 highs would be required to maintain the bullish scenario.

Levels to watch for Silver (XAG) trading:

Resistance Levels:

• 2025 record $55.48
• $52 to $53 mini-resistance
• $50.50 to $51 mini-resistance at 61.8% fib of corrective move
• Potential resistance 1 $57.50 to $60 (1.382% from 2022 lows)
• Potential resistance 2 $62 to $65 (1.618 from Impulsive Move)

Support Levels:

• $48 to $49 2011 High Pivot
• $47 low of potential daily channel
• $45.55 October 28 lows
• $43.00 to $45.00 Weekly pivot
• $39.50 to $40 higher timeframe support
• 2012 Highs Support around $37.50

Silver has put an impressive start to this week but is facing a critical lower timeframe test:

The 61.8% Fibonacci level from the end-October correction is creating an essential pivot zone between $50.50 and $51.

The candles are strong and not indicative of a pullback for now, however consolidation may ensue due to overbought levels.

A rejection here could still face support between $48.30 to $49, a support zone that includes the 50 and 200 4H-period MA.

A daily close at current levels would nonetheless assume that bears are absent of the battle – Keep a close eye on potential breakouts (or in a lack thereof, a small reversal).

Safe Trades!

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