Silver Price Eyes $33.75 as U.S.-China Trade Deal Lifts Outlook
Silver (XAG/USD) is up at $32.82 and consolidating within a tightening symmetrical triangle. Traders are waiting for a breakout signal.
Quick overview
- Silver (XAG/USD) is currently priced at $32.82 and is consolidating within a tightening symmetrical triangle as traders await a breakout signal.
- A recent US-China trade deal has positively impacted industrial metals like silver, which relies heavily on industrial demand.
- Upcoming US economic data and Federal Reserve signals are crucial for silver's performance, with traders looking for hints of rate cuts.
- Technically, silver is near a key resistance level at $33.24, and a breakout above this could lead to further gains.
Silver (XAG/USD) is up at $32.82 and consolidating within a tightening symmetrical triangle. Traders are waiting for a breakout signal. The metal’s price action reflects the broader macro trends, including the recent US-China trade deal announcement that could support industrial demand for silver which accounts for over 50% of its total use.
Trade Deal Boosts Industrial Metals
A breakthrough in US-China trade talks over the weekend has given industrial metals like silver a much needed boost. Treasury Secretary Scott Bessent described the Geneva negotiations as “productive” and hinted at possible tariff reductions that could ease supply chain bottlenecks and boost manufacturing demand. Since over half of silver’s demand comes from industrial applications like electronics and solar panels, any reduction in trade barriers could be big for the metal.
But traders should be cautious as full details of the deal have not been announced yet. Any disappointment or lack of clarity in the final announcement could trigger a sell off.
Fed Policy and Data in Focus
Silver’s performance also depends on upcoming US data and Fed signals. The Fed held rates steady in May but traders are looking for more clarity on rate cuts. Jerome Powell’s Thursday speech and US CPI and retail sales data will be watched for dovish cues. If the Fed hints at easing it could weaken the dollar and boost non-yielding assets like silver which performs well in a low rate environment.
Key Levels and Setup
Technically silver is consolidating just below a key resistance at $33.24 which is close to the upper boundary of the symmetrical triangle. A break above this level could lead to a move to $33.52 followed by $33.75 which is 2.5% above current levels.
The MACD is showing early signs of bullish momentum with the histogram flipping positive and the MACD line crossing above the signal line. This crossover suggests buyers are in control and an upward breakout is more likely.
Trade Setup:
Buy Above: $33.24
Take Profit: $33.75
Stop Loss: $32.65
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