Silver Price Forecasts & Predictions

From the panic low of the Coronavirus scare last March when silver bottomed at $11.30 to its inflation-induced peak at $29.82 in August, silver prices rose an incredible 163% during 2020 in less than five months. Yet as this article is going to press the day of the US inauguration, silver is trading just above $25.50 per ounce. In other words, since the August peak, silver has done nothing but fall by 15% over the last five months.

So what is ahead for silver as 2021 gets underway? Was the advance of the first half of 2020 a sign of things to come? Or is silver set to continue declining as it has done since the peak last August?

Silver 2021: First-Half Lower Volatility

Silver is shaping up to have a less-volatile first half of the year than it did in 2020, before a strong continuation advance develops as the second-half of the year approaches. Below we show the spot silver price from 2020 through 2021:

• Silver is currently in a trendless state. Note how both the rising trend from April 2020 (turquoise double lines), and the declining trend from the August 2020 peak (turquoise line) have both been broken. The breaking of both a rising and declining trend shows us that neither buyers nor sellers are currently in control of the silver price.
• When no active trend exists in a market, we must observe at what other support or resistance levels silver participants are buying and selling.
• Note that buyers have shown up on three occasions since September 2020 between $21.65 - $22.55 (black support). This level should continue to see buyers emerge unless proven otherwise.
• Note that sellers have shown up on at least six occasions above $27.40 (black resistance). This resistance level should continue to see sellers emerge unless proven otherwise.
• In sum, we have...

Silver is like gold’s cheaper and more volatile little brother. The smaller market size of the white metal relative to gold makes it susceptible to wilder price swings. So how has it been performing relative to gold’s corrective actions since November? And finally, where do the miners stand in all this?

The entire precious metals sector moved higher on Tuesday, and one might wonder if this changes anything regarding the outlook. In short, it doesn’t. The move higher was in line with what I previously described as a likely outcome.

It was quite possible for gold to rally up to its September lows, and the low in gold futures in terms of the closing prices was $1,866.30. Yesterday’s closing price for gold futures was exactly $1,866.

So, did anything unusual happen? Not really.

Looking briefly at gold, can it move even higher from here? As discouraging (or encouraging, depending on one’s perspective) as this answer may be, it’s a “yes”. The US Dollar Index is currently trading at about 90.8, and its downside target is at about 90, so there is room for another short-term slide. Such a slide would be likely to trigger a rally in the yellow metal. How high could the rally go during this final part of the counter-trend corrective upswing?

Perhaps to the mid-November high of about $1,900. Even though gold might theoretically rally all the way up to the early-November high, I don’t see this as being likely.

At the moment of writing these words, gold has corrected more or less half of its November decline. Did silver correct as much?

Actually, silver corrected visibly more. Its already at its mid-November highs and relatively...