Silver Price Analysis: XAG/USD tumbles to near $70.50, near-term outlook turns bearish
- Silver price tumbles to near $70.60 in Thursday’s early European session.
- Surging oil prices and a firm rate outlook weigh on the precious metals.
- The white metal turns negative in the near term, with bearish RSI momentum.
- The first upside barrier emerges at $73.80; the initial support level to watch is $68.00.
Silver price (XAG/USD) slumps to around $70.60 during the early European session on Thursday. The white metal faces some selling pressure after comments from US President Donald Trump on the Iran conflict.
Trump said during a primetime televised speech from the White House on Thursday that his core "objectives are nearing completion" in Iran. Nonetheless, he added that the US would hit Iran “extremely hard” for the next two to three weeks.
These remarks have pushed crude oil prices higher and reduced expectations of interest rate cuts. Silver is often used amid geopolitical uncertainty but does not yield interest, making it less attractive when interest rates are high.
Technical Analysis:
In the daily chart, the near-term bias of XAG/USD turns bearish as price extends its decline beneath the 100-day exponential moving average near $73.80, confirming a loss of the medium-term uptrend structure. RSI at 40.97 holds below the 50 midpoint and continues to track lower, indicating sellers retain momentum after the breakdown from overbought territory in the mid-80s area.
Immediate resistance emerges at the 100-day EMA around $73.80, with the Bollinger middle band near $76.25 reinforcing a wider supply zone that would cap any corrective bounce. A sustained move above that area would be needed to ease the current downside bias and reopen the $80.00 region. On the downside, initial support is located near the recent swing area around $68.00, followed by the psychological $65.00 handle. A decisive break below $65.00 would expose the lower Bollinger Band region around $63.20, where oversold conditions could slow, but not necessarily end, the prevailing bearish phase.
(The technical analysis of this story was written with the help of an AI tool.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
Author
Lallalit Srijandorn
FXStreet
Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.
