Silver’s current consolidation is technical in nature, but momentum has shifted to the downside. A sustained move below $41.68 could trigger deeper selling toward a key double-bottom zone at $40.73–$40.40. If that fails, traders will look to the 50% retracement band between $39.96 and $39.59. The 50-day moving average at $39.01 remains the key trend indicator and major support level to watch.
To reignite the bullish trend, silver must break decisively above $42.97. Such a move would not only negate the bearish pattern but also reopen the path to challenge multi-year resistance at $44.22.
Semiconductor Demand and Dollar Weakness Fuel the Bigger Picture
Despite the recent pullback, spot silver is still up 46.47% year-to-date, narrowly trailing 2020’s 47.7% surge in percentage terms. However, in absolute price terms, silver has already broken above 2020 highs, reaching a 14-year peak. The rally has been fueled by strong demand from the semiconductor sector and safe-haven interest, giving this move similar intensity to the one seen during the peak of pandemic-era uncertainty.
Meanwhile, the U.S. dollar index (DXY) gained 0.20% on Wednesday, offering near-term pressure on metals. But the broader picture remains dollar-negative. Investor pessimism surrounding global trade disruptions and concerns over Federal Reserve independence are driving safe-haven interest into both gold and silver.