- The price of silver experiences a notable decline, approaching $33.00, amid growing optimism regarding a potential easing of trade tensions between China and the US.
- Reports indicate China is weighing the possibility of suspending tariffs on select goods imported from the United States.
- Chinese officials refute claims of ongoing economic and trade discussions with the United States.
The price of silver (XAG/USD) is currently trading near $33.00, reflecting a drop of over 1.5% during Friday’s North American trading session. This decline follows a peak earlier in the day at $33.70, a high point for the past three weeks. The precious metal’s value has diminished as market participants express increased confidence in the likelihood of a forthcoming agreement between the US and China.
The prospect of a de-escalation in the trade dispute between the world’s two leading economies has gained traction following reports from Bloomberg suggesting that China is considering a temporary halt to additional tariffs on certain US imports, including medical equipment and specific industrial chemicals.
Market observers interpret this development as a positive sign for the global economic future. In theory, a brighter global economic outlook tends to reduce the appeal of safe-haven investments, such as silver.
Concurrently, the US Dollar (USD) has shown resilience, rebounding after a sharp downward correction on Thursday. The Dollar Index (DXY), which measures the dollar’s strength against a basket of six major currencies, has recovered to approximately 99.75.
However, conflicting statements from US President Donald Trump and Chinese authorities regarding the existence of trade negotiations are likely to keep investors cautious. While Trump has asserted that trade discussions between Washington and Beijing are progressing well, China has contradicted these claims, stating that no “economic and trade negotiations between China and the US” have taken place.
Silver technical assessment
The price of silver is undergoing a significant correction after reaching a new three-week high around $33.70. Nevertheless, the short-term perspective for the metal remains optimistic, supported by its position above the 20-day Exponential Moving Average (EMA), currently around $32.60.
The 14-day Relative Strength Index (RSI) is encountering resistance in its attempt to surpass the 60.00 level. A renewed upward trend could be signaled if the RSI manages to break through this barrier.
Looking ahead, the high of $34.60 from March 28 is expected to serve as a critical resistance level for silver. Conversely, the low of $30.90 from April 11 is identified as a key support area.
Silver daily price movement
Frequently Asked Questions About Silver
Silver stands as a valuable metal, actively traded by investors. Historically, it has functioned as a wealth reserve and a means of transaction. While less prevalent than Gold, Silver offers traders a chance to broaden their investment holdings, capitalize on its inherent worth, or potentially protect against inflation. Investors have the option to acquire Silver physically, through coins or bars, or engage in trading via instruments like Exchange Traded Funds, which mirror its price dynamics in global markets.
A multitude of elements can influence Silver price fluctuations. Factors such as geopolitical uncertainty or fears of a significant economic downturn can elevate Silver prices due to its perceived safety, although less so than Gold. As a non-yielding asset, Silver tends to appreciate when interest rates are reduced. Its movements are also correlated to the performance of the US Dollar (USD) since it is priced in dollars (XAG/USD). A robust Dollar typically restrains Silver’s price, while a weaker Dollar is likely to push prices higher. Additional aspects like investment interest, mining output – Silver is more abundant than Gold – and recycling practices can also impact prices.
Silver finds widespread application in various industries, notably in sectors like electronics and solar power, owing to its superior electrical conductivity compared to Copper and Gold. Increased demand can drive prices upward, while a decrease tends to lower them. Economic trends in the US, China, and India can also contribute to price volatility: the substantial industrial sectors in the US and especially China utilize Silver in numerous processes; in India, consumer demand for the precious metal in jewelry also significantly influences price determination.
Silver prices generally mirror the trends observed in Gold. When Gold prices increase, Silver typically follows, reflecting their shared status as safe-haven assets. The Gold/Silver ratio, representing the quantity of Silver ounces needed to match the value of one Gold ounce, can aid in assessing the relative valuation of both metals. Some investors might view a high ratio as an indication that Silver is undervalued, or Gold is overvalued. Conversely, a low ratio could suggest that Gold is undervalued relative to Silver.
