Silver (XAG/USD) depreciated over 3% after modest gains the previous day, trading around $63.20 per troy ounce during Asian hours on Monday, with technical analysis indicating a prevailing bearish bias as the spot price remains within a descending channel pattern and beneath both the nine-day and 50-day Exponential Moving Averages (EMAs) [1]. The 14-day Relative Strength Index (RSI) at 34.64 suggests bearish momentum persists but may be losing intensity [1]. Initial support is noted at the six-month low of $61.01, with further declines potentially exposing the lower boundary of the channel at $57.50. Resistance levels include the nine-day EMA at $66.31 and the upper boundary of the channel at $69.70, with a break above potentially targeting the 50-day EMA at $72.70 and the three-month high of $90.03 [1].
Gold (XAU/USD) also weakened, sliding back below the $4,150 level during the Asian session on Tuesday, reversing much of the previous day's gains amid a bullish US Dollar [2]. The USD's strength is attributed to ongoing skepticism regarding US-Iran peace talks and the US Federal Reserve's hawkish stance, which has pushed the dollar to its highest level since May 2025 [2]. Mediators Qatar and Pakistan reported encouraging progress in US-Iran negotiations, with both sides agreeing on a roadmap toward a final deal within 60 days and the US temporarily lifting sanctions on Iranian oil exports [2]. However, conflicting messages persist: US Vice President JD Vance stated Iran agreed to admit nuclear monitors and accept weapons inspections, while Iran's foreign ministry denied new commitments on nuclear inspections [2].
Geopolitical tensions remain elevated, with US President Donald Trump emphasizing the importance of preventing Iran from obtaining a nuclear weapon over economic consequences, and Iran's chief negotiator asserting continued control over the Strait of Hormuz [2]. These factors maintain a geopolitical risk premium and support the safe-haven appeal of the US Dollar, further pressuring precious metals [2]. On the monetary policy front, the Fed signaled the need for rate hikes if inflation remains high, with Chicago Fed President Austan Goolsbee noting inflation is running above the 2% target, reinforcing expectations for rate increases in September or December [2].
Market participants are now awaiting the release of US flash PMIs, speeches from FOMC members, the US Personal Consumption Expenditures (PCE) Price Index, and the final Q1 GDP print on Thursday, all of which are expected to influence USD and precious metals volatility [2].
CONCLUSION
Both silver and gold prices have come under significant pressure due to a strengthening US Dollar, persistent geopolitical uncertainty, and expectations of further US Federal Reserve rate hikes. Technical indicators for silver suggest continued bearish momentum, while gold's decline is tied to both monetary policy and unresolved US-Iran negotiations. Upcoming US economic data and geopolitical developments are likely to drive further volatility in precious metals markets.