Silver is trading steadily at approximately $32.30 as tensions escalate between the US and China, with China imposing a 125% import duty on US goods. Concerns about a potential US recession have led to a boost in US bond yields, while the US Dollar Index has dropped to around 99.60.
The trade war between these major economies is creating challenges for the US economy. The reciprocal tariff increase by President Trump and China’s response could affect domestic importers and reduce household purchasing power. Furthermore, there is dwindling demand for US assets, reflected in the decline of 10-year US Treasury yields by over 1% during European trading hours.
Silver has surpassed the 20-day Exponential Moving Average, aiming for the October high of $34.87. The 14-day Relative Strength Index suggests a possible resistance near 60.00, with key support identified at the April high of $30.81.
Silver is a treasured asset, impacting investment portfolios and serving as a hedge against inflation. Its pricing is influenced by geopolitical tensions, US Dollar strength, interest rates, and global demand. Silver’s industrial applications, especially in electronics and solar energy, also shape its demand dynamics and price fluctuations globally.
What we see unfolding is a direct market response to mounting frictions between two economic heavyweights. The newly enforced 125% import tariff by China, in direct retaliation to Trump’s move, signals how trade dynamics continue to rattle broader financial structures. This isn’t just tit-for-tat politics—it’s hitting home for investors through waning confidence and reduced appeal in core US instruments.
One such impact is visible in declining appetite for long-dated Treasuries. Ten-year yields dropping over a full percentage point during European hours shows that market participants are opting for safety or seeking yield elsewhere. When buyers start skipping Treasuries, the underlying message is clear: uncertainty over returns is growing. These yield moves aren’t occurring in isolation either. A US Dollar Index dipping to 99.60 feeds into the story—demand for the greenback weakens proportionately to concerns over trade, recession, and rate longevity.
For silver, these factors are coalescing at a time when technical indicators are turning more active. After breaching its 20-day EMA, traders have started eyeing the $34.87 zone, last seen in October, as the next high-water mark. We note momentum is building—but not without resistance. The RSI hovering around 60 suggests strength without excess, yet it also tells us a stall is possible before breaking new ground. Short-term momentum traders might already be watching for a reaction around these levels.
Support remains healthy near $30.81, not far from recent consolidation, and adds cushion for any pullback scenario. A breach under that could alter the picture rapidly, especially if driven by sudden dollar recovery or an abrupt cooling in metals buying out of Asia.
Outside of charts, we’re aware that silver’s role reaches beyond store-of-value discussions. Its utility in photovoltaic cells and semiconductors ties it tightly to physical demand—especially from manufacturers catching up after pandemic-related supply disruptions. As clean energy agendas push ahead, those links are unlikely to weaken in the medium term.
Amid tightening policies and fiscal caution worldwide, higher real interest rates typically dull silver’s shine. That’s not definitive today though. Because as inflation concerns linger and monetary tools reach their limit, a return to defensive positions—like metals—remains plausible.
So in the weeks ahead, it may be worth paying attention not only to price levels, but also to shifts in bond sentiment and purchasing activity from Asia. All of this could reinforce or reverse silver’s current trajectory, particularly if GDP data stateside or export numbers from China set off another sentiment swing.
