Silver (XAG/USD) accelerated its downtrend on Tuesday, reaching fresh two-week lows at $73.35, as market attention shifted from geopolitical tensions to upcoming monetary policy decisions by major central banks this week [1]. The ongoing energy shock from the Middle East conflict has heightened global inflationary pressures, prompting expectations that central banks may maintain or even tighten monetary policy in the coming months [1]. This environment has weighed on non-yielding precious metals like silver, which typically struggle during monetary tightening cycles [1].
The US-Iran conflict remains unresolved, with the Strait of Hormuz closed, which has kept crude oil prices nearly 50% above pre-war levels. This situation has supported the safe-haven US Dollar and exerted additional downward pressure on precious metals, including silver [1]. Technical analysis indicates a persistent bearish bias for XAG/USD since its mid-April highs above $83.00, with the Relative Strength Index (RSI) around 35 and the MACD marginally negative, both suggesting continued downside risk [1].
Bears have breached support at the 38.2% Fibonacci retracement level near $74.70, with targets now set between the April 12 low at $72.60 and the 50% Fibonacci level at $72.12. Further support lies at the 61.8% Fibonacci retracement just below the $70.00 psychological mark [1]. On the upside, resistance is expected at $74.70, followed by $76.60 and $78.50, corresponding to recent highs [1].
No forward-looking statements or analyst opinions beyond technical analysis are provided in the source [1].
CONCLUSION
Silver prices have fallen sharply to two-week lows amid expectations of continued or tighter central bank policies and persistent geopolitical tensions. Technical indicators and breached support levels suggest further downside risk for XAG/USD in the near term. Market sentiment remains negative, with no immediate signs of a trend reversal.