Silver prices are currently trading near $82, just below the resistance zone between $85 and $95. The technical setup suggests a further decline. And here’s why:
1. Price coiling beneath resistance
In early March, the precious metal breached the lower boundary of the $85–$95 range amid an alarming situation in the Middle East and settled there. A subsequent retest of the $85 level confirmed the shift: the former support solidified into resistance. This is a telltale sign of a looming downtrend.
2. RSI flirting with oversold territory
The Relative Strength Index (RSI) has recently dipped into the negative zone and is now sitting near 30, inching toward oversold territory. Therefore, sellers are on horseback, leaving buyers behind. This is yet another piece of evidence pointing to further declines.
3. MACD turning negative
The Moving Average Convergence/Divergence (MACD) bar chart has begun exploring the red, signaling increasing selling pressure that has put bulls on the back foot. What’s more to add? The bearish message is loud and clear.
The macroeconomic landscape offers little comfort for the precious metal either. The heated atmosphere surrounding the Middle East—and the Strait of Hormuz in particular—remains a key concern. The risk of supply disruptions has bolstered commodity prices and intensified inflation expectations. As a result, market participants have grown more skeptical about the Federal Reserve’s (Fed) easing cycle, anticipating now that interest rates could stay higher for longer. This scenario is beneficial for the greenback and US Treasuries. Silver, in contrast, generates no income and pales next to the dollar-denominated assets.
Taken together, the aforementioned technical and fundamental factors create favorable conditions for the metal’s downward movement toward $72.
The final recommendation:
— Sell silver at the current price, targeting $72 in the next one to two weeks;
— Place a Stop Loss order at $85 to mitigate risk if the market plays against us.
This content is for informational purposes only and is not intended to be investing advice.
