Silver prices (XAG/USD) increased by 0.5% to trade near $75.75 during the European session on Monday, driven by optimism that the United States and Iran may soon reach a permanent peace agreement [1]. US President Donald Trump stated on Truth Social that Iran is eager for a deal, while also warning that military action remains an option. Over the weekend, Trump mentioned in a Fox Business interview that the terms of the deal with Iran have been revised, emphasizing the destruction of Tehran’s nuclear dust and the reopening of the Strait of Hormuz as key demands [1].
The article notes that oil prices have rebounded following recent attacks exchanged between Israel and Lebanon. Historically, silver and oil prices have shown a negative relationship since the onset of the war, as higher energy prices have fueled global inflation and led traders to reduce expectations for dovish Federal Reserve policy. This environment is generally unfavorable for non-yielding assets like silver [1].
From a technical perspective, XAG/USD is trading higher at around $75.75 but remains broadly sideways over the past two weeks, fluctuating between $71.79 and $78.83. The near-term tone for silver is bearish, as it trades below the 20-day EMA at $76.92, with the Relative Strength Index (RSI) just below the neutral 50 mark at 47, indicating subdued bullish momentum after a recent pullback. Key resistance is at the May 25 high of $78.83, with further upside potential toward the May 15 high of $83.88 if surpassed. On the downside, a drop below the May 28 low of $71.79 could see silver fall to the April 7 low of $68.28, with major support at the March 23 low of $61.01 [1].
Looking ahead, investors are focusing on the upcoming US Nonfarm Payrolls (NFP) data for May, scheduled for release on Friday, which could further influence silver prices [1].
CONCLUSION
Silver prices have edged higher on hopes for a US-Iran peace deal and ongoing geopolitical tensions, but technical indicators suggest a bearish near-term outlook. Market participants are closely watching upcoming US economic data, which could provide further direction for silver.