Silver (XAG/USD) holds steady around $33.00 amid growing concerns over the US economy.
FUNDAMENTAL OVERVIEW:
- Silver prices remain stable as a weaker US Dollar reflects mounting concerns over a potential economic slowdown.
- However, resistance may emerge as the Federal Reserve maintains its forecast for two rate cuts this year.
- Additionally, improved risk sentiment and the White House’s adjusted tariff strategy could weigh on Silver’s upside potential.
Silver (XAG/USD) rebounds on Monday, trading near $33.10 per troy ounce during Asian hours after three consecutive losses. The recovery is supported by a weaker US Dollar, as concerns mount over a potential US economic slowdown linked to President Donald Trump’s trade policies.
The US Dollar Index, which tracks the USD against six major currencies, pauses its three-day advance and dips near 104.10. Investors now turn their focus to the preliminary US S&P Global Manufacturing PMI for March.
Silver may encounter challenges as the Federal Reserve (Fed) upholds its projection of two rate cuts later this year, following its decision to keep the federal funds rate steady at 4.25%–4.5% during its March meeting. The Fed’s position, which aligns with expectations of slower GDP growth and rising unemployment, serves as a counterweight to inflation concerns that could be heightened by President Trump’s imposition of aggressive tariffs.
Furthermore, silver prices may face downward pressure due to shifting safe-haven demand amid improving risk sentiment, as the White House adjusts its tariff strategy ahead of the April 2 implementation. According to the Wall Street Journal, the administration plans to eliminate certain industry-specific tariffs while introducing reciprocal tariffs targeting nations with strong trade ties to the U.S.
Meanwhile, geopolitical tensions have eased following discussions between Ukrainian and U.S. officials in Riyadh on Sunday. Negotiations aimed at securing a ceasefire continue, with President Trump pushing for an end to the three-year conflict. Ukrainian Defence Minister Rustem Umerov highlighted efforts to protect energy and critical infrastructure, while U.S. and Russian representatives are scheduled for separate talks on Monday, Bloomberg reports.
XAG/USD TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
Silver is trading within a up channel.
Silver is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in Buying Zone, while the Stochastic oscillator suggests Neutral trend.
Immediate Resistance level: 33.50
Immediate support level: 32.62
HOW TO TRADE XAG/USD
Silver experienced a sharp rally, followed by a corrective pullback that established a support base before reversing higher and breaking key resistance levels. Currently, it is retracing toward a support zone. If this zone holds, Silver could regain momentum and resume its upward trajectory, targeting further gains.