Silver price (XAG/USD) trades lower to near $76.00 during the Asian trading session on Tuesday. The white metal has been slightly under pressure as dovish Federal Reserve (Fed) expectations remain capped despite cooling United States (US) inflation in January.
Theoretically, immaterial dovish Fed prospects in the near-term weigh on non-yielding assets, such as Silver.
The data showed on Friday that the US headline inflation dropped to 2.4% Year-on-Year (YoY) from 2.7% in December. In the same period, the core Consumer Price Index (CPI) – which excludes volatile food and energy items – grew moderately by 2.5%, as expected, against the previous reading of 2.6%.
Meanwhile, investors brace for high volatility in the North American session as US markets will open after an extended weekend.
This week, the major trigger for the Silver price will be the release of Federal Open Market Committee (FOMC) minutes of the January policy meeting on Wednesday. In the meeting, the Federal Reserve (Fed) left interest rates unchanged in the range of 3.50%-3.75%.
Globally, investors will pay attention to the second round of talks between the US and Iran in Geneva during the day. Delegates from both nations are expected to discuss the nuclear programme in Tehran. Ahead of talks, US President Donald Trump has signaled that Iran will make a deal, while warning that the nation will face consequences if they don’t resolve issues.
Silver technical analysis
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In the daily chart, XAG/USD trades at $75.98. The 20-day exponential moving average descends to $83.52, signaling a weakening short-term structure. Price holds below this gauge, keeping rebounds capped and leaving sellers in control. RSI(14) at 43.67 (neutral) stays under the midline, indicating momentum favors the downside without oversold conditions.
A daily close back above the falling 20-day EMA would ease immediate pressure and improve the near-term tone. Absent that, the path of least resistance remains lower, with failed bounces prone to being faded as the average continues to cap recovery attempts.
(The technical analysis of this story was written with the help of an AI tool.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold’s moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
