Silver price analysis: Here’s why gold/silver ratio is the guiding light

Silver price remains on recovery mode as geopolitical tensions and economic uncertainties support the metal’s safe-haven appeal. Besides, supply constraints and a positive demand outlook continue to fuel a decline in the gold/silver ratio. As a crucial analysis tool, the ratio points to an opportunity in the white metal as it continues to outperform the more lustrous precious metal, gold. 

However, the observed move towards a more neutral sentiment in the broader market may cause some consolidation before the bulls gather further momentum. Compared to the previous session’s fear level of 42, the fear & greed index is closer to the neutral zone at 46. 

In the ensuing sessions, investors will be keen on the possibility of a US attack on Iran, as well as Trump’s decision on global tariffs. The overall market sentiment will also influence the precious metals’ safe-haven appeal vs the risk appetite. At the time of writing, the silver price was at a three-week high at $91.06; up by 4.54%. 

Silver outperforms gold as gold/silver ratio extends decline

After plunging from its all-time high by close to 50%, silver price has entered into a steady recovery mode. In fact, it is outperforming its lustrous cousin, gold. 

A look at the gold/silver ratio, which measures the number of silver ounces needed to buy an ounce of gold, points to a similar situation as in 2025. The ratio has been in the red for six consecutive sessions, dropping to a three-week low at 57.19. This places it below the short-term 25-day EMA and the medium-term 50-day MA. 

The free-fall in the gold/silver ratio, which has gone on for months now, has been bolstered by silver’s supply constraints and heightened demand. Besides, optimism over the recovery of the global economy has had investors choosing the white metal, which doubles up as a safe-haven and crucial industrial metal. 

With the volatility set to continue in the short-to-medium term, investors will be keen on monitoring the fundamentals and market sentiment. Tight supply and optimism on the demand front may continue to attract more buyers into the silver market. 

At the same time, a trend reversal may bolster gold price. In that case, silver would still benefit from its status as a preferred alternative to the more expensive gold metal.  

SLV silver price technical analysis

The SLV silver ETF has been within a trading range over the past two weeks after the profit-taking mode plunged it back below the previously steady support zone of $80 an ounce. However, it has been on recovery in recent sessions. 

At the start of the week, it extended its gains to retest the crucial support-turn-resistance level of $80. As the iShares Silver Trust moves in tandem with the silver bullion, the momentum has attracted enough buyers to break past $80 to the next target along the resistance level at $82.08. At the time of writing, it was trading at $82.59. 

In the immediate term, the focus will be on whether the market sentiment will yield fresh range-bound trading with the 25-day EMA at $76.40 offering steady support. With further recovery, SLV silver price will be on track to hit a one-month high at $85.