Silver prices fell on Monday due to a slight rebound in the US Dollar and growing optimism about a trade deal between the US and China, along with potential peace talks in Ukraine. Technical analysis suggests that Silver’s drop from the $38.50 resistance level has broken an upward trend, signaling the end of a bullish phase. Support for Silver is seen at the 38.2% Fibonacci retracement level around $37.60, indicating a possibility of further declines. Key targets to watch include the low from August 5 and the 50% Fibonacci level near $37.30, dropping down to the 61.8% level at $36.05. To shift away from this downward trend, Silver needs to surpass the $38.00 mark and revisit the $38.40-$38.50 range.

Silver As A Store Of Value

Silver acts as a store of value, swayed by factors such as geopolitical issues, interest rates, and movements of the US Dollar. Demand from industries, especially electronics and solar energy, also affects its price. Silver often tracks Gold’s price changes due to their shared safe-haven status, and the Gold/Silver ratio helps analysts understand their relative values. As of August 11, 2025, it seems that Silver’s bullish trend has paused. The break from the ascending channel is an important technical indicator that we are entering a correction phase. Last week’s US Consumer Price Index showed a rise to 2.9%, which has strengthened the US Dollar and added pressure on precious metals. In the upcoming weeks, we will consider bearish strategies. The fall below the $37.60 support level suggests that prices may head toward the next key targets. We see opportunities for short positions or buying put options with strike prices targeting $37.30 and $36.05.

Gold Silver Ratio

The weakness is also reflected in the Gold/Silver ratio, which has increased to 85:1 from around 82:1 in late July. This shows that Silver is lagging behind Gold, indicating lower investor interest in the more volatile metal. Recent reports from major electronics manufacturers lowering their Q4 forecasts hint at a potential drop in industrial demand. However, it’s essential to set our risk parameters wisely. If Silver moves above the $38.00 level, it will challenge our bearish outlook and might trigger a short squeeze. We previously saw a similar situation in the summer of 2024, where a brief decline was followed by a significant rally, so we will monitor that for our stop-loss strategy. The current geopolitical situation, particularly the positive developments from the Geneva peace talks, is reducing the demand for safe-haven assets. Silver’s sensitivity to Federal Reserve comments was evident throughout 2023, and any hints of hawkishness from the Fed could further push prices down. Our bias remains bearish unless there is a significant change in the technical outlook. Create your live VT Markets account and start trading now.

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