Overview
Silver prices have recently declined, falling below key resistance levels as traders prepare for the upcoming Federal Reserve minutes and navigate the complexities of U.S. tariff policies. The price of silver (XAG/USD) has slipped below the immediate resistance range of $37.23 to $37.32, with a critical pivot point at $36.30 being closely monitored.
Impact of Federal Reserve Minutes
The market's attention is primarily focused on the Federal Reserve's June meeting minutes, with traders looking for dovish signals that could weaken the dollar and lower yields. Such a scenario would create a favorable environment for silver, which is currently facing headwinds from rising Treasury yields that diminish the appeal of non-yielding assets like silver.
Tariff Developments and Inflation Concerns
Recent announcements of tariffs ranging from 25% to 40% on imports from 14 countries, including Japan and South Korea, have reignited trade tensions and raised inflation concerns. While these tariffs could potentially support silver prices through increased inflation, the immediate market sentiment remains cautious due to the upward pressure on interest rates.
Technical Analysis
Silver's price action indicates a critical juncture. If the price fails to maintain the $36.30 pivot, it may test major support levels between $35.40 and $34.87, with the 50-day moving average at $34.60 serving as a crucial defense for the current uptrend. Conversely, reclaiming the $37.32 level could signal renewed buying interest, especially if the Fed's stance turns dovish.
Market Outlook
The silver market is currently in a consolidation phase, reflecting a broader range-bound trade in precious metals. Traders are advised to remain vigilant for potential catalysts from the Federal Reserve or further escalations in tariff policies. A dovish Fed could lead to dollar weakness and yield relief, potentially driving silver prices higher, while continued increases in Treasury yields could exert further downward pressure.