Silver prices are stabilizing above $36.00, which is now acting as immediate support after a breakout in June. Ongoing tensions between Israel and Iran are increasing Silver’s demand as a safe investment. Meanwhile, the performance of the US Dollar and Treasury yields are impacting the market ahead of the FOMC decision. This month, Silver’s value has climbed over 10%, but it seems to be consolidating as it waits for new market drivers. The US Dollar has weakened due to political instability, which is helping Silver stay around $36.38, with a slight gain of 0.2% since Friday. The Israel-Iran conflict has boosted the demand for safe assets like Silver. There are rumors that Iran may restart nuclear talks with the US, which could limit Silver’s potential to rise. However, some Iranian officials dispute these reports. Increased speculation about a possible interest rate cut by the Federal Reserve has made Silver more appealing, balancing the uncertainty stemming from the Middle Eastern conflict. With Silver trading near $36.38 after a strong rally, traders are closely watching key resistance and support levels identified by recent trends and technical indicators. Positioning in Silver is more cautious now that prices are hovering just above $36.00. Buyers who were eager during the June breakout are showing signs of reservation, causing the metal to move sideways as various macroeconomic factors influence its outlook. The ongoing geopolitical risks, especially regarding Iran and Israel, have heightened the allure of safer assets. Yet, reports of potential diplomatic talks between the US and Tehran have introduced some complexity to the situation. While initial reactions drove prices higher, any confirmation of easing tensions could limit further gains. In terms of volatility, Silver rose over 10% in June, so a period of sideways movement is expected. The metal holding around $36.38 reflects this cooling momentum, despite slight gains recently. This muted activity is partly due to a weaker US Dollar, which faces pressure from domestic uncertainties and expectations around the Fed’s future interest rate decisions. Each decline in the dollar seems to give Silver more room to stabilize at this level. The bond market has added a two-way risk element, with Treasury yields dipping slightly, supporting the view that the Fed might be done tightening. Renewed expectations for a rate cut by year-end are making non-yielding assets more attractive, particularly if the Fed is set to respond to an unstable economy. This sentiment appears to be driving interest in Silver. However, the market is sensitive to rate changes, and the upcoming Federal Open Market Committee meeting will likely influence direction. From a technical perspective, the price range is tightening. There’s support just below at $36.00, which has held multiple times during trading. Traders are now focused on recent highs to determine if momentum can build again. The market is watching closely for reactions to US economic data releases and any updates on interest rate expectations. Short-term trading is likely to favor metal exposure unless hawkish comments from Powell or Fed officials emerge, which could push Treasury yields higher and dampen demand. Looking ahead, we’ve noted the stabilization phase and expect quieter price movements until more policy signals are given. This may favor mean-reverting strategies or range-based trading for technical traders until signs of a breakout reappear. Market inflows will remain sensitive to headlines, meaning sharp developments in the Middle East or updates from Iran could lead to quick changes in pricing. The elevated options premium indicates that traders are anticipating uncertainty rather than a clear direction. Right now, we are monitoring Silver’s behavior around established resistance. If it fails to convincingly reach recent highs, a re-test of lower support levels becomes more likely. Conversely, any dovish shift from the Fed or further reduction in geopolitical tensions could spark another upward move. The combination of falling yields and a weaker dollar provides some support for bulls, but positioning suggests a more cautious phase ahead. Whether this results in a broader reversal or just a temporary pause will depend on upcoming developments in Washington and Vienna.

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