Silver Price Forecast: XAG/USD consolidates near 13-year highs amid tariff tensions
|- XAG/USD trades near $36.70, holding within a tight four-week consolidation range just below 13-year highs.
- Tariff tensions in focus as President Trump targets 14 countries, including Japan and South Korea, with 25% levies.
- Silver holds within $35.50–$37.30 range, with the 20-day SMA at $36.42 acting as immediate support.
Silver (XAG/USD) is trading near $36.70 on Tuesday, easing slightly on the day but holding firm within a narrow consolidation range. The metal has been hovering near 13-year highs, as markets assess the potential impact of the latest tariff threats by US President Donald Trump.
US President Trump announced updated tariff rates on 14 countries that have not reached trade agreements with Washington, including key trading partners such as Japan and South Korea, both of which will face 25% levies. Additionally, Trump signed an executive order extending the reciprocal tariff deadline to August 1 from July 9, giving negotiators more time but also keeping trade tensions high.
The trade tensions have boosted safe-haven demand for Silver, but the metal is still moving sideways as investors wait for a clear direction amid mixed global factors. While geopolitical risks and tariff concerns have underpinned buying interest, expectations for delayed monetary policy easing by the Federal Reserve (Fed) are limiting further upside. Stronger-than-expected US employment data last week reduced the likelihood of an immediate Fed interest rate cut, keeping the US Dollar steady and capping gains in precious metals, such as silver.
From a technical perspective, for the past four weeks, Silver has been moving sideways between $35.50 and $37.30, reflecting a wait-and-see approach by traders following a strong rally in early June. The spot price continues to trade above the 20-day Simple Moving Average (SMA), which also serves as the middle line of the Bollinger Bands, currently around $36.42. This level is acting as immediate support and has managed to keep the bullish bias intact.
Bollinger Bands are starting to narrow, indicating lower volatility and a potential breakout ahead. However, without a clear directional trigger, Silver is likely to remain in this holding pattern. Momentum indicators paint a cautiously bullish picture. The Relative Strength Index (RSI) is hovering near 60, showing moderate buying interest without signaling overbought conditions. Meanwhile, the Rate of Change (ROC) stands at +1.21, indicating mild upward momentum but lacking strong conviction.
A sustained daily close above $37.30 would confirm a bullish breakout and could pave the way toward $38.00 and $39.00 in the near term.
On the downside, the first support level is around $36.42, which corresponds to the middle line of the Bollinger Bands. A break below this level could expose the lower Bollinger Band near $35.72, which also marks the bottom of the current range. If that support fails to hold, the next downside target is $34.50, signaling a deeper corrective move.
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