Silver Forecast: Bullish Rebound in Tight Position, Market Targets $71.31
2026-02-06 01:46:39
On Thursday (February 5), spot silver prices plummeted during the US trading session, resuming last week's sharp decline after a brief two-day period of stabilization. This round of selling was mainly driven by weakness in the gold market. Silver had already shown signs of fatigue on Wednesday, failing to follow gold's rebound to the 50%-61.8% retracement level of the $96.49-$102.43 range.
Silver prices are currently trading below the $83.61-$74.63 retracement range, and have also broken below the 50-day moving average at $77.07, leaving only the swing low of $71.31 as a potential support level.
The $71.31 low is the last line of defense.
According to the daily chart, if the price falls below $71.31, the silver trend will officially turn downward, and the 200-day moving average at $49.82 will become the next target to watch.
A stronger dollar and easing geopolitical tensions were the driving forces behind the decline.
Besides the weakening of gold, some analysts attributed the sell-off to a stronger dollar, easing geopolitical tensions, and low market liquidity, which were also considered to be among the reasons for the increased selling pressure.
The stubborn bulls finally conceded their losses and left the market.
In my view, the stubborn bulls who held on during the initial decline have finally begun selling off their positions as the market continues to search for a bottom. The potential downside target may be $59.34 (the high on December 5th), which some believe was the initial starting point for silver's upward breakout. Another potential support level is the psychological level of $50.00. Since there is no substantial support above the 50-day moving average at $77.07, with only the 200-day moving average at $49.82 remaining, the aforementioned levels are all effective support targets.
(Spot silver daily chart source: EasyTrade)
Silver prices hit key support level
Today's low for silver was $72.31, and the weekly low was $71.31. The market has reached a critical support level, and this support range is only $1 wide. Silver not only needs to hold this support level, but also needs to close above the 50-day moving average to confirm the validity of a double bottom.
Silver prices fluctuated wildly, leading Pandora to shift its focus to platinum.
According to reports, jewelry brand Pandora announced that it will switch the plating of some of its products to platinum to avoid the sharp fluctuations in silver prices. This news may lead to a decline in silver demand, which, coupled with the drop in spot silver prices, will further exacerbate the downward trend.
Numerous negative factors and a lack of buying power.
The recent silver sell-off was triggered by numerous factors. When a bull market collapses as rapidly as the silver market, analysts list various negative reasons to rationalize the decline. I prefer the most fundamental logic: selling pressure far exceeds buying pressure—current market participants are generally bearish on silver, for various reasons. For traders, the key is to find credible sources of information and logical justification; however, for momentum trading, the specific reasons for the price crash are actually not important.
Chinese market speculation may explain the speed of the plunge.
I agree with Bloomberg's view that excessive trading by Chinese speculative funds is the underlying factor behind this round of silver sell-off. Although gold also closed lower today, its trend was relatively stable and the sell-off was orderly; while silver has lower trading activity and higher volatility, and once it breaks down, the two-month rebound can easily be wiped out in one fell swoop.
At 01:44 Beijing time, spot silver was trading at $76.226 per ounce, down 13.39%.
Silver prices are currently trading below the $83.61-$74.63 retracement range, and have also broken below the 50-day moving average at $77.07, leaving only the swing low of $71.31 as a potential support level.
The $71.31 low is the last line of defense.
According to the daily chart, if the price falls below $71.31, the silver trend will officially turn downward, and the 200-day moving average at $49.82 will become the next target to watch.
A stronger dollar and easing geopolitical tensions were the driving forces behind the decline.
Besides the weakening of gold, some analysts attributed the sell-off to a stronger dollar, easing geopolitical tensions, and low market liquidity, which were also considered to be among the reasons for the increased selling pressure.
The stubborn bulls finally conceded their losses and left the market.
In my view, the stubborn bulls who held on during the initial decline have finally begun selling off their positions as the market continues to search for a bottom. The potential downside target may be $59.34 (the high on December 5th), which some believe was the initial starting point for silver's upward breakout. Another potential support level is the psychological level of $50.00. Since there is no substantial support above the 50-day moving average at $77.07, with only the 200-day moving average at $49.82 remaining, the aforementioned levels are all effective support targets.
(Spot silver daily chart source: EasyTrade)
Silver prices hit key support level
Today's low for silver was $72.31, and the weekly low was $71.31. The market has reached a critical support level, and this support range is only $1 wide. Silver not only needs to hold this support level, but also needs to close above the 50-day moving average to confirm the validity of a double bottom.
Silver prices fluctuated wildly, leading Pandora to shift its focus to platinum.
According to reports, jewelry brand Pandora announced that it will switch the plating of some of its products to platinum to avoid the sharp fluctuations in silver prices. This news may lead to a decline in silver demand, which, coupled with the drop in spot silver prices, will further exacerbate the downward trend.
Numerous negative factors and a lack of buying power.
The recent silver sell-off was triggered by numerous factors. When a bull market collapses as rapidly as the silver market, analysts list various negative reasons to rationalize the decline. I prefer the most fundamental logic: selling pressure far exceeds buying pressure—current market participants are generally bearish on silver, for various reasons. For traders, the key is to find credible sources of information and logical justification; however, for momentum trading, the specific reasons for the price crash are actually not important.
Chinese market speculation may explain the speed of the plunge.
I agree with Bloomberg's view that excessive trading by Chinese speculative funds is the underlying factor behind this round of silver sell-off. Although gold also closed lower today, its trend was relatively stable and the sell-off was orderly; while silver has lower trading activity and higher volatility, and once it breaks down, the two-month rebound can easily be wiped out in one fell swoop.
At 01:44 Beijing time, spot silver was trading at $76.226 per ounce, down 13.39%.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
