Silver Technicals: Bollinger Bands Tighten, Symmetrical Triangle Forms Ahead of Breakout

Silver markets entered July 2025 in a holding pattern, with prices trading at $36.18 per ounce as of early morning, according to official trading data.

The past 24 hours saw silver oscillate within a narrow range, consolidating just above the 50-day exponential moving average and forming a classic symmetrical triangle pattern on both daily and four-hour charts.

This technical setup signals that traders are waiting for a decisive move, with the next breakout likely to define the summer’s direction. The technical picture offers little ambiguity.

The daily chart shows silver holding above key support at $36.15, with resistance forming at $36.22 and a breakout threshold at $36.83. The Relative Strength Index (RSI) sits at 57.44, reflecting neither overbought nor oversold conditions.

The Moving Average Convergence Divergence (MACD) on the daily timeframe remains slightly positive, hinting at underlying bullish momentum, though the histogram has flattened, indicating a pause in upward force.

Bollinger Bands have narrowed, a sign that volatility has compressed and a larger move may be imminent. The four-hour chart echoes these signals, with RSI at 51.46 and MACD near neutral, reinforcing the market’s wait-and-see stance.

Silver Poised for Further Gains on Persistent Supply Deficit

Fundamentals remain the driving force behind silver’s resilience. The global market faces its fifth consecutive year of supply deficit, with the Silver Institute projecting a shortfall of 117.7 million ounces for 2025.

Mine output continues to decline, pressured by lower ore grades, resource depletion, and regulatory hurdles in key producing countries like Mexico and Peru.

The mining sector’s inability to ramp up supply quickly has created persistent tightness, with above-ground inventories shrinking for several years. Demand, meanwhile, shows no signs of abating.

Industrial applications now account for nearly 59% of total silver demand, led by the solar sector and electronics manufacturing. Photovoltaic installations, especially in China, have reached new highs, and the latest solar technologies require even greater silver inputs.

Automotive and electronics sectors also continue to draw heavily on available supply, while investment demand remains robust. Silver exchange-traded funds have seen inflows outpace gold for three consecutive months.

Official data shows ₹2,277 crore in net inflows since March in India alone. Macroeconomic factors add further complexity. The Federal Reserve’s policy stance, inflation data, and US dollar movements remain key variables.

Persistent inflation and a weaker dollar have supported silver’s appeal as a hedge, while any shift in Fed policy could quickly alter the landscape. Geopolitical risks, particularly in major mining regions, continue to threaten supply stability.

Market participants now focus on the $36.83 resistance level. A break above this point, especially on strong volume, could trigger a move toward $38 per ounce, aligning with several institutional forecasts.

Until then, silver’s story remains one of tight supply, strong industrial pull, and a market poised for its next act.

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