Silver (XAG/USD) rose on Friday after bouncing from around $74, gaining over 2.50% to trade near $77.20 per troy ounce. The move followed a softer-than-expected US inflation report, though silver is set to finish the week down.
Silver is down 0.85% for the week after starting near $80.00. US stocks fell on Thursday, which pushed silver lower as it has recently tracked equities.
Key Technical Levels
The Relative Strength Index points to sideways trading, with resistance near the 50-day SMA at $79.08. Support is seen at $64.41, where the 100-day SMA sits.
If silver drops below $75.00, support is at the 13 February low of $74.01. Below that, the next level is $70.00, ahead of the 100-day SMA.
If silver moves back above $80.00, resistance is at the 29 December high of $83.75. The next resistance is the 11 February high of $86.30.
Looking back at the analysis from this time last year, we can see the market was hopeful after a soft inflation report. We saw silver gain on the news but ultimately fail to reclaim the key $80.00 level. That failure to break higher in February 2025 signaled a period of weakness that defined the rest of the year.
The core issue was that inflation proved much stickier than the market anticipated throughout 2025, with the CPI ending the year at 3.1%, well above the Federal Reserve’s target. This forced the Fed to hold interest rates higher for longer, which historically puts pressure on non-yielding assets like silver. We saw this play out as silver prices gradually eroded, breaking below the technical floors mentioned in last year’s outlook.
Market Outlook And Positioning
Today, silver is trading near $68.50, meaning the 100-day moving average from last year at $64.41 is no longer a distant floor but a critical support level we are now watching closely. The sideways action suggested by the RSI last year eventually resolved to the downside due to these persistent macroeconomic pressures. For traders, this means puts with a strike price below $65 could offer effective portfolio insurance against a further drop.
Given that industrial demand, particularly for solar panels, grew an estimated 12% in 2025, a strong fundamental floor exists. This creates a conflict between poor monetary policy conditions and strong physical demand. This suggests selling cash-secured puts or initiating bull put spreads around the $64-$65 level could be a viable strategy to collect premium while defining risk.
The current market is defined by low conviction, with implied volatility in silver options still below the highs we saw in late 2025. Therefore, we should consider strategies that benefit from range-bound price action until there is a clear catalyst from either the Fed or a significant shift in industrial consumption forecasts. Reclaiming the $70.00 figure from last year’s analysis would be the first sign that this downward pressure is finally starting to ease.
