XAG/USD Forecast: Silver Gears for Breakout – Is Silver the Next Gold?

Jasper Osita - Market Analyst

2025-10-21 14:37:14

Silver consolidates near $51, preparing for a breakout as the market digests a 4-hour volume imbalance ($51.118–$52.395).
The metal remains supported by strong industrial demand, tight supply, and safe-haven inflows similar to gold’s earlier rally.
A 4H close above $52.395 could send silver toward $54–$55, while failure below $50.60 risks a dip into $49.66 before re-accumulation.

Silver Gathers Momentum Beneath $54 – Following Gold’s Footsteps

Silver has entered a tension-filled holding pattern — not weak, just waiting for ignition.

After rallying to $54/oz, its highest in more than a decade, the market is now consolidating just below that level, mirroring gold’s earlier pattern before its own explosive breakout.

The reason? The metal is balancing order flow inside a critical 4-hour Fair Value Gap (FVG) between $51.118–$52.395 — a zone where prior selling created inefficiency.

Price currently sits at $50.75, testing buyers’ commitment as volume compresses and liquidity builds.

This “pause before propulsion” could define silver’s next major phase — and traders are watching whether it repeats gold’s parabolic move.

Silver Mirrors Gold’s Macro Tailwinds

Industrial Demand Still Rising:

Silver’s dual role — industrial metal and monetary hedge — keeps it in demand. The solar and EV sectors continue to consume record levels of silver, straining mine output in Mexico, Peru, and China.

Physical Shortage Deepens:

Physical silver inventories at London and COMEX remain near multi-year lows, forcing refiners to reroute supply from Asia. This supply squeeze underpins the spot premium and keeps futures backwardated.

Safe-Haven Flows Pick Up:

With the U.S. shutdown dragging on and investors bracing for further Fed cuts, funds are once again rotating into metals. As gold flirts with $4,500, silver is attracting renewed speculative inflows aiming to catch “the next gold-style breakout.”

Technical Outlook: Silver Mirroring Gold?

Silver’s structure remains constructively bullish, though tactically neutral within the current balance.

The 4-hour volume imbalance ($51.118–$52.395) acts as the pivot — a zone where supply met demand but delivery remains unfinished.

Price is compressing between this imbalance and immediate support at $49.665.

When that compression breaks, momentum should accelerate sharply.

Key Technical Levels

Type	Price Zone	Technical Role
All-Time High	$54.000	Liquidity target
H4 Volume Imbalance (FVG)	$51.118 – $52.395	Control zone / re-pricing area
Immediate Support	$49.665	Short-term liquidity base
Bullish Targets	$53 → $54 → $55	Expansion levels
Bearish Targets	$49.00 → $47.80	Re-pricing zones

Bullish Scenario – Reclaiming the 4H Volume Imbalance

Silver’s repeated defense of $50–$50.70 shows buy-side absorption.

If price reclaims $51.118, it signals demand stepping back into imbalance territory.

Trigger:

A 4H close above $51.118 followed by a break through $52.395 confirms that sellers’ inefficiency has been filled and flipped to support.

Targets:

$53.00 – first liquidity magnet
$54.00–$55.00 – next expansion wave

Narrative:

This would mark a bullish re-balancing of volume, restoring buy-side delivery similar to gold’s prior structure.

A successful FVG reclaim transforms the zone into demand — often the prelude to a sustained breakout.

Bearish Scenario – Rejection from the Volume Imbalance

Failure to close above $52.395 or repeated rejections inside the FVG suggest sellers are still defending overhead liquidity.

Trigger:

A 4H close below $50.60 signals renewed sell-side control and continuation toward liquidity resting below $49.60.

Targets:

$49.665 – immediate liquidity draw
$48.50 → $47.80 – deeper discount territory

Narrative:

As long as $51.118 remains unclaimed, the imbalance stays bearish.

Price could slide into discount levels before rebuilding another leg higher.

Volume Balance Story: The Pivot Between Two Worlds

The $51.118–$52.395 zone is the line in the sand.

Volume is evenly balanced — neither bulls nor bears hold control — but this balance is unstable.

Above $52.395 → Buy-side imbalance resumes → breakout toward $54.
Below $50.60 → Sell-side imbalance resumes → draw to $49–$48.

This equilibrium reflects a coiled-spring structure: energy building beneath resistance, similar to gold’s pre-breakout profile earlier this quarter.

Final Takeaway

Silver is standing at a technical crossroads that echoes gold’s structure weeks ago — tight compression, rising demand, and a visible imbalance zone waiting to break.

Reclaiming $52.395 could unleash a fast leg toward $54–$55, validating the idea that silver is becoming “the next gold.”

Failing to do so simply extends the accumulation window around $50–$49, where long-term buyers likely reload for the next wave.

Start Practicing with Confidence - Risk-Free!

Trade forex, indices, gold, and more
Access ACY, MT4, MT5, & Copy Trading Platforms
Practice with zero risk

It’s time to go from theory to execution - risk-free.

Create an Account. Start Your Free Demo!

Check Out My Contents:

Strategies That You Can Use

Looking for step-by-step approaches you can plug straight into the charts? Start here:

Indicators / Tools for Trading

Sharpen your edge with proven tools and frameworks:

How To Trade News

News moves markets fast. Learn how to keep pace with SMC-based playbooks:

Learn How to Trade US Indices

From NASDAQ opens to DAX trends, here’s how to approach indices like a pro:

How to Start Trading Gold

Gold remains one of the most traded assets - here’s how to approach it with confidence:

How to Trade Japanese Candlesticks

Candlesticks are the building blocks of price action. Master the most powerful ones:

How to Start Day Trading

Ready to go intraday? Here’s how to build consistency step by step:

Swing Trading 101

Learn how to navigate yourself in times of turmoil

Markets swing between calm and chaos. Learn to read risk-on vs risk-off like a pro:

Want to learn how to trade like the Smart Money?

Step inside the playbook of institutional traders with SMC concepts explained:

Master the World’s Most Popular Forex Pairs

Forex pairs aren’t created equal - some are stable, some are volatile, others tied to commodities or sessions.

Metals Trading

Stop Hunting 101

If you’ve ever been stopped out right before the market reverses - this is why:

Trading Psychology

Mindset is the deciding factor between growth and blowups. Explore these essentials:

Market Drivers

Risk Management

The real edge in trading isn’t strategy - it’s how you protect your capital:

Suggested Learning Path

If you’re not sure where to start, follow this roadmap:

Start with Trading Psychology → Build the mindset first.
Move into Risk Management → Learn how to protect capital.
Explore Strategies & Tools → Candlesticks, Fibonacci, MAs, Indicators.
Apply to Assets → Gold, Indices, Forex sessions.
Advance to Smart Money Concepts (SMC) → Learn how institutions trade.
Specialize → Stop Hunts, News Trading, Turmoil Navigation.

This way, you’ll grow from foundation → application → mastery, instead of jumping around randomly.

Follow me for more daily market insights!

Jasper Osita - LinkedIn - FXStreet - YouTube

This content may have been written by a third party. ACY makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplies by any third-party. This content is information only, and does not constitute financial, investment or other advice on which you can rely.

Author

Jasper has been in the markets since 2019 trading currencies, indices and commodities like Gold. His approach in the market is heavily accompanied by technical analysis and of course, supported by fundamentals. He has a background in trading proprietary firms and has been teaching students how to navigate themselves in the markets from basic to advance concepts.

Try These Next

4 Powerful Tactics to Overcome the Most Costly Forex Mistakes

How to Master MT4 & MT5 - Tips and Tricks for Traders

The Importance of Fundamental Analysis in Forex Trading

Forex Leverage Explained: Mastering Forex Leverage in Trading & Controlling Margin

The Importance of Liquidity in Forex: A Beginner's Guide

Close All Metatrader Script: Maximise Your Trading Efficiency and Reduce Stress

Best Currency Pairs To Trade in 2025

Forex Trading Hours: Finding the Best Times to Trade FX

MetaTrader Expert Advisor - The Benefits of Algorithmic Trading and Forex EAs

Top 5 Candlestick Trading Formations Every Trader Must Know

Prices are indicative only