KEY POINTS:
- Silver remains supported amid geopolitical tensions, weak US data and dovish Fed expectations
- Risks in the short-term include the US NFP report on Friday and potential US Supreme Court decision on tariffs
- Big picture uptrend should remain intact amid the Fed's dovish reaction function
- Price chart shows a possible double top in the making
FUNDAMENTAL OVERVIEW
Silver has been the hottest asset of 2025. The fundamentals are the same as for gold, but silver is more volatile. The precious metal continues to be supported by the geopolitical tensions, the weak US data and the dovish Fed expectations. The bullish momentum remains intact, but we have two important events on Friday that could challenge that.
In fact, on Friday we get the latest US NFP report and while the previous report might have been taken with a pinch of salt due to shutdown related issues, this one should give us a clearer picture. Strong data might lead to a bigger pullback as traders push back on expectations of an imminent Fed rate cut, while soft figures should keep on supporting the upside.
Moreover, yesterday the US Supreme Court scheduled Friday as an opinion day, which could see a decision on Trump’s tariffs. In case the tariffs are struck down, silver will likely fall amid easing stagflation risks. On the other hand, if tariffs are kept in place, it shouldn’t change much although it would keep the upside intact.
In the bigger picture, silver should remain in an uptrend as real yields will likely continue to fall amid the Fed’s dovish reaction function. But in the short term, a hawkish repricing in interest rate expectations could weigh on the market.
SILVER TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that silver recovered all the losses from last week’s selloff and touched the all-time highs. Is this going to be a double top or will we see new record highs ahead? The sellers will likely step in around these levels with a defined risk above the all-time high to position for a drop into the 69.00 handle. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into new all-time highs.
SILVER TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we can see that we have an upward trendline defining the bullish momentum. If we get a pullback into the trendline, we can expect the buyers to lean on it with a defined risk below it to position for a rally into a new all-time high. The sellers, on the other hand, will look for a break lower to increase the bearish bets into the 69.00 handle.
SILVER TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we can see that the price broke below the upward trendline that was defining the bullish momentum on this timeframe. This could be a signal of a loss of momentum and a bigger pullback in the cards. The sellers piled in on the break targeting a drop into the major trendline. The buyers have a mixed picture here and will need to wait for a pullback into the major trendline or a break above the all-time high.
UPCOMING CATALYSTS
Today we have the US ADP, the US ISM Services PMI and the US Job Openings data. Tomorrow, we get the latest US Jobless Claims figures. On Friday, we conclude the week with the US NFP report and potential US Supreme Court decision on Trump’s tariffs.
