Silver Maintains Bullish Momentum: Trading Above $80 on Multiple Tailwinds

Silver (XAG/USD) has climbed more than 5% to reach the highest level of the year, trading decisively above the $80 per troy ounce mark. The rally has been underpinned by a combination of geopolitical uncertainty and shifting expectations around Federal Reserve policy, particularly following softer employment data that suggests potential rate cuts ahead.

What’s Driving the Silver Price Rally

The precious metals complex continues to benefit from safe-haven buying as investors navigate geopolitical concerns. Simultaneously, recent weakness in the US labor market has reinforced market conviction that the Fed may pivot toward monetary easing in the near term. These factors have overshadowed the headwinds from elevated US Treasury yields and a resilient US Dollar, pushing silver to a new year-to-date peak of $81.43.

Technical Setup: Strength Meets Stretched Conditions

From a technical perspective, silver’s price action reveals sustained buying pressure despite the Relative Strength Index (RSI) reaching overbought levels above 70. Notably, the strength of this advance suggests the overbought reading may not signal an imminent reversal; rather, it reflects genuine momentum in the asset. The RSI would need to cross above 80 to suggest more extreme conditions.

Resistance levels to watch:

• Immediate resistance: $81.44 (today’s high)
• Next target: $82.00
• Major resistance: $85.87 (all-time high)

Support levels for traders:

• Critical support: $80.00 (psychological level)
• First pullback target: $77.88 (January 5 high)
• Secondary support: $75.00

The path of least resistance remains upward, though traders should remain alert to potential mean reversion given the extended nature of the current move. A decisive break below $80.00 could accelerate a correction toward the lower support zones, while a breach above $81.44 would likely trigger fresh buying toward $82.00 and potentially the all-time high.