Silver (XAG/USD) is stabilizing after bouncing back from a three-day decline as market sentiment shifts to caution. This change is driven by new global trade tensions and falling US Treasury yields, which are increasing demand for precious metals. Currently priced around $36.63, the metal has eased from a daily high of $36.85. Silver found support near $36.30 and rebounded after the US threatened new tariffs on countries like Algeria and the Philippines, with rates expected to be between 20% and 50% starting August 1. Minutes from the Federal Reserve’s June meeting suggest possible rate cuts later this year, although inflation risks from tariffs might be temporary. Technically, Silver has been trading in an upward pattern since April, moving between $35.50 and $37.00 in recent weeks, with $37.30, a 13-year high, being a significant resistance level. The Relative Strength Index (RSI) is around 58, showing bullish momentum. The Rate of Change (ROC) is about 1.76, indicating moderate upward pressure. If the price breaks above $37.00, it could rise to $38.00-$38.50. Initial support is at $36.22, followed by $35.50, and $34.50 if bearish conditions take hold. Currently, silver prices are steady after a brief drop, but they haven’t exceeded recent highs. The price has responded positively to the new trade tensions and lower bond yields, both of which support metals like silver. A slight decrease in US Treasury yields lowers the cost of holding silver, which doesn’t provide yield but typically becomes more attractive when growth or interest expectations drop. The Federal Reserve’s June meeting hinted at potential interest rate cuts this year. However, tariff-related inflation could complicate this timeline. The Fed views these inflation pressures as temporary rather than long-term hinderances, which is important for those investing in rate-sensitive assets. From a structural viewpoint, silver has been following a clear upward trend since early April, showing consistent higher lows and resistance around $37.00. RSI readings just below overbought levels indicate there is still room for buyers, though the path isn’t entirely clear. The Rate of Change metric around 1.76 shows that price movement has upward momentum, but it’s not explosive—more of a steady rise. What does this mean for positioning? For those managing risk, the crucial pivot remains at $37.00. A firm move above this level may not ensure a strong breakout, but it could increase the chances of reaching $38.00 or even $38.50. Conversely, if sellers push the price below $36.22, especially on high volume, the next support level will be closer to $35.50. If this support fails, it could lead to a breakdown of the channel, allowing a test near $34.50. Traders should view these levels as zones that may trigger trading activity, especially around expiration dates or significant economic announcements. Price movements in the next few sessions could be volatile, especially with headlines about tariffs or guidance from US officials. If this continues, silver might remain in demand as a perceived hedge. It’s important to keep a close watch on the 13-year resistance at $37.30, as it could lead to long-term interest or profit-taking depending on how quickly it’s approached. We will also monitor implied volatility, which might increase if macroeconomic factors become more unpredictable. Hedging strategies should be reassessed, particularly for those holding short gamma positions. Pay attention to market expectations for interest rates, especially in swaps and futures, as these influence fixed-income assets—and consequently, metals related to inflation and policy changes. As always, risk management must remain flexible. Open interest at the top of this range suggests traders are active but not yet fully committed to a breakout or reversal. This hesitance is noteworthy. Any sudden shift in dollar strength or changes in bond auctions could upset this balance. For now, upward movement remains intact but is not aggressive. Any significant directional bets need to be supported by data or confirmed technical breakouts.

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