Strong US dollar and sluggish industrial demand weigh on silver

Silver prices keep moving sideways, consolidating near $75 per ounce. The main pressure is now coming from a stronger dollar, supported by a pause in the US-Iran peace talks. Last week showed signs of progress in negotiations, but no agreement was reached. These conditions are favorable for the American currency as a safe-haven asset.

The fundamental picture is also quite bearish. According to a Bank of America’s (BofA) forecast, the silver deficit issue is expected to become significantly less acute this year. Solar panel producers—previously the metal’s key consumer—are now using cheaper alternatives in order to ease margin pressure. Industrial demand was silver’s primary pillar of support, setting it apart from gold.

Investment interest in the asset is not strong enough to offset the decline in manufacturing consumption. Moreover, traders appear more drawn to the stock market, which continues to hit one record after another—particularly in the technology sector. Activity in exchange-traded funds (ETFs) is declining, while futures are not showing an increase in long positions, suggesting a lack of fresh capital inflows capable of sustaining a steady uptrend.

US macroeconomic statistics also put pressure on silver. Labor market data, including Friday’s Nonfarm Payrolls, are expected to reinforce market beliefs in a rate hike by the Federal Reserve (Fed). The likelihood of monetary tightening in the US by the end of 2026 has already climbed to 60%. High borrowing costs increase the opportunity cost of holding silver, thereby capping its upside.

Technical indicators paint a rather murky picture. The precious metal remains trapped in the $73–$77 flat range. The Relative Strength Index (RSI) sits at 29—not far from oversold territory. This may signal a short-term rebound. The Chaikin Oscillator, however, remains in the positive zone, pointing to slowing capital inflows and a lack of active accumulation. Without fresh money coming in, any recovery would be unstable.

Consider the following trading strategy:

Sell silver within the $76.300–$76.500 range. Place Take profit at $73.200 and Stop loss at $78.545.

This forecast remains pertinent between June 1 and June 7, 2026.