Gold and Silver Price Forecast: Industrial Demand and Fib Levels Guide Moves

Market Overview

Gold and silver are currently attracting significant investor interest as economic growth slows and interest rate expectations shift amidst ongoing market uncertainty. Central banks continue to be a major source of gold demand, with the World Gold Council reporting that official sector purchases exceeded 1,000 tonnes for the third consecutive year in 2025.

In contrast, silver demand is increasingly driven by industrial applications, with over 55% of global silver consumption now utilized in manufacturing sectors such as solar energy, electric vehicles (EVs), and electronics. The solar industry alone is projected to consume over 200 million ounces annually as the renewable energy sector expands.

Supply Challenges

Despite the rising demand for silver, global supply is struggling to keep pace. This is not due to a lack of silver resources but rather declining ore grades and insufficient investment in mining operations, which are limiting output growth.

Macro Economic Indicators

Current U.S. economic data presents mixed signals. While service sector activity remains stable, the job market is experiencing slower hiring and fewer job openings. This has led investors to speculate that interest rates may decrease, which historically benefits precious metals like gold and silver, making them more attractive as non-yielding assets.

Long-term investors are increasingly viewing gold and silver as structural assets due to ongoing central bank purchases of gold and the industrial necessity for silver, all within a shifting global economic landscape.

Gold Price Forecast

Gold (XAU/USD) is currently trading around $4,435, having recently rebounded from a low of $4,275. The price action shows smaller candlestick bodies with upper wicks indicating resistance near the $4,550 trend line. The price remains within a rising channel, with support at $4,330 and a significant Fibonacci retracement level at $4,398, which serves as a short-term support level.

Resistance is noted between $4,480 and $4,500. A trading strategy suggested is to buy at $4,400 with a target of $4,500, while placing a stop-loss below $4,330.

Silver Price Forecast

Silver (XAG/USD) is currently around $76.15 after failing to break the $82.60 resistance level. A key support level is identified at $75.05, which aligns with trendline support and previous price activity. A dip to $72.50 may present a buying opportunity.

The Relative Strength Index (RSI) has dropped to the mid-40s, indicating a potential easing of momentum, but as long as the price remains above trend support, the uptrend is considered intact. A suggested trading strategy is to buy around $75.00 with a target of $82.50, while monitoring for a drop below $72.40 to exit the position.