Silver Prices Test 100-Day SMA Amid Ongoing Rally

Silver prices are testing their 100-day simple moving average (SMA) as the recent rally continues. The spot price is hovering just below $31.80, a level that has historically acted as a significant pivot point for silver.

The metal's gain in momentum over the past week can be attributed to a softer US dollar and renewed industrial demand. A weaker US dollar makes it cheaper for foreign buyers, boosting demand and prices. Additionally, expectations that the Federal Reserve may pause its rate-hiking cycle have also contributed to the rally.

On the technical side, the Relative Strength Index (RSI) is at 58, indicating bullish momentum but not yet overbought. The MACD has also crossed bullish, suggesting a potential breakout. However, traders should exercise caution and watch for confirmation above $31.80 to avoid false breakouts.

For long-term investors, the industrial demand story provides a fundamental backdrop. Silver's dual role as both a precious and industrial metal gives it a unique position in the commodities market. The solar panel sector accounts for about 10% of global silver consumption, with global solar installations projected to grow by 15% in 2025.