Silver Price Forecast: XAG/USD holds firmly above 20-day EMA, US-Iran talks in focus
- Silver price consolidates around $89.00 ahead of US-Iran nuclear talks.
- The US wants Tehran to drop its plans to build nuclear infrastructure.
- The US trade policy uncertainty has weighed on the US Dollar.
Silver price (XAG/USD) trades in a tight range around $89.00 during the European trading session on Thursday. The white metal consolidates ahead of nuclear talks between the United States (US) and Iran in Geneva later in the day.
Investors will pay close attention to the US-Iran meeting outcome to get clarity on Middle East tensions. In the meeting, Washington wants Tehran to give up its intentions to build nuclear infrastructure. Ahead of the meeting, US President Donald Trump has also warned of military action in case Tehran denies reaching a deal.
Trump threatened Tehran through a post on Truth.Social on Monday that it will be a very bad day for the country and its people if they don’t reach a deal.
Theoretically, the Silver price tends to perform better in heightened geopolitical uncertainty.
Meanwhile, the Silver price is broadly firm due to a weak US Dollar (USD) amid uncertainty surrounding the US trade policy outlook. Investors worry that some countries could demand trade deal revisions with the US, following the Supreme Court’s (SC) verdict against President Donald Trump’s tariff policy.
As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally lower to near 97.50. Technically, a lower US Dollar makes Silver a value buy for investors.
On Wednesday, US Trade Representative Jamieson Greer said that Washington could raise tariffs to 15% or above on some nations from the recently announced 10% duties. Greer didn’t disclose the names of US trading partners that could be charged higher tariffs. Global 10% duties were announced by President Trump shortly after SC’s ruling against tariffs to offset the same.
Silver technical analysis
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XAG/USD trades calmly at around $89.00 at the press time. The near-term bias is mildly bullish as price holds above the 20-day Exponential Moving Average, which has turned higher and underpins the recovery from the mid-month low. The sequence of higher closes since the $73–$74 area reinforces a corrective upswing within the broader pullback from the $116 region.
The 14-day Relative Strength Index (RSI) is inside the 40.00-60.00 range, signaling a sideways trend.
Initial support is located at the 20-day EMA near $84.50, with a break below exposing the next downside level at $81.00 and then the recent low around $74.00. On the topside, immediate resistance appears at the February 4 high of $92.21, followed by a stronger barrier at $102.00 and then the $108.00 area. A daily close above $94.00 would strengthen the bullish bias toward the higher resistance band, while a drop through $84.50 would neutralize the current upside structure.
(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
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
