Here's When Silver Will Surge Like Gold

Gold has skyrocketed by an impressive $345 per ounce since July, while silver has trailed behind. However, there’s compelling evidence that silver is poised to surge soon.

I’ve noticed many on social media expressing frustration over silver’s lackluster performance compared to gold over the past several months. Some are even close to giving up on silver as gold continues its strong run. In this article, I'll make the case for why silver is on the verge of a breakout that could not only close the gap with gold but may even surpass its recent performance. Not too long ago, I urged the precious metals community to stay patient with gold during its summer stagnation, and now it’s on a tear. I see many similarities in the current situation with silver.

Let's begin with silver’s daily chart. While silver has been acting soggy in recent months, the good news is that it closed above a downtrend line that began in May this past Friday. This breakout is a promising sign of strength. Silver now needs to close above its $32.50 resistance level with strong volume to confirm that the next leg of the bull market is underway. Once silver clears the $32.50 resistance, it’s likely to surge toward $50 rapidly. I'm focusing on $50 as an intermediate-term target because it’s a significant psychological level and the peak reached during both the 1980 and 2011 rallies.

For additional confirmation, I find it useful to analyze silver priced in euros. This approach eliminates the effects of U.S. dollar fluctuations, providing a clearer picture of silver's intrinsic strength or weakness. Interestingly, silver priced in euros tends to respect round numbers like €26, €27, and €28 very nicely, often establishing key support and resistance levels at these points. These levels are worth keeping an eye on—see for yourself. Notably, silver's rally halted almost precisely at the €30 level, which has now become a critical resistance. A decisive close above this level would signal that silver is ready to take off. However, before reaching that point, silver must first break through the downtrend line that is just overhead.

Silver mining stocks are also worth monitoring to confirm silver’s price movements, as they often reflect investor sentiment toward silver. The Global X Silver Miners ETF (symbol: SIL), the most heavily traded silver mining stock ETF, has been stuck in a flat range since April. A strong, high-volume close above the $36 to $37 resistance zone would be a powerful signal that both silver mining stocks and silver itself are primed to take off.