On 27 November, we suggested that silver was preparing to challenge its all-time high. Since then (marked with the orange arrow), XAG/USD has risen by roughly 18%, breaking above the psychological $60-per-ounce threshold for the first time in history.

The rally has been driven by strong retail inflows into silver ETFs, alongside expectations of a structural supply deficit by 2026 due to robust industrial demand—particularly from solar energy, electric vehicles, and data-centre infrastructure.

The weakening of the US dollar following the Federal Reserve’s decision on Wednesday also helped lift dollar-denominated silver to a new historic peak near $64.

Technical Analysis of XAG/USD

A review of the XAG/USD chart shows that the price has been moving within a rising channel that encapsulates the uptrend beginning in early September.

Within this structure:
→ the channel median acted as a springboard for price growth on 4 December;
→ the line dividing the upper half of the channel into quarters switched from resistance (earlier in the month) to support on 10 December;
→ silver is now trading near the channel’s upper boundary, which may behave as significant resistance (as it did in mid-October).

Given these factors, the market may now be heavily overheated, leaving it vulnerable to a correction. Should this scenario begin to unfold, we could see a bearish break of the steep upward trajectory that has lifted silver by around 30% from the 21 November low.

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