Silver prices (XAG/USD) dropped by 0.9% to about $51.90 during late Tuesday trading in Asia. This decline is attributed to increased selling pressure, particularly as easing tensions in US-China trade have, for the moment, stalled the metal’s upward momentum.
With trade tensions lessening, there’s a noticeable decrease in demand for safe-haven assets, including silver.
Relations between the US and China are improving, with President Donald Trump feeling optimistic that a deal will be reached ahead of his upcoming meeting with Chinese President Xi Jinping this month.
In advance of this meeting, U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are set to meet in Malaysia later this week to discuss, among other things, the Chinese government’s new restrictions on rare earth mineral exports and the U.S.’s 100% tariffs on imports from China.
Additionally, the anticipation of the federal government reopening this week is another factor in the silver price decline. White House economic adviser Kevin Hassett indicated in a CNBC interview that the government shutdown “will likely end this week.”
Investors are keeping a close eye on the Consumer Price Index (CPI) data for September, which is expected to be released on Friday. This inflation information will play a crucial role in shaping the market’s expectations regarding the Federal Reserve’s monetary policy.
Silver Technical Analysis
After reaching an all-time high of about $54.50 on Friday, silver prices have retreated. However, the short-term trend still appears bullish as the 20-day exponential moving average (EMA) remains on an upward trajectory, currently near $49.34.
Moreover, the 14-day Relative Strength Index (RSI) is hovering above 60.00, indicating sustained bullish momentum.
The 20-day EMA is likely to act as significant support going forward, while the all-time high of $54.50 might pose as a crucial resistance level.
