- The price of Silver falls as the US Dollar recovers sharply, with Trump keeping the tariff increase plan intact.
- Trump ordered federal agencies to examine trade relations with neighbors and China.
- Traders have raised dovish bets for the Fed’s May policy meeting.
The price of Silver (XAG/USD) falls slightly near $30.50 in the European session on Tuesday. The white metal faces pressure as the US Dollar (USD) rebounds strongly after President Donald Trump confirmed that the plan to increase tariffs on foreign countries is delayed, not denied. On his first day in the White House, Trump mentioned that the proposal for universal tariff increases is on the table, but “We’re not ready for that yet.”
The US Dollar Index (DXY), which tracks the value of the dollar against six major currencies, rebounds sharply from its nearly two-week low around 108.00, which it recorded on Monday. Historically, a higher US Dollar weighs on precious metals, such as Silver, by making them expensive for investors.
The dollar plunged on Tuesday after reports from the Wall Street Journal (WSJ) showed that tariff increases were absent from a presidential memo. However, the memo indicated that Trump has directed federal agencies to study trade policies and evaluate trade relations with China and other North American economies.
Meanwhile, the decline in the price of Silver has been limited by falling bond yields. Lower yields on interest-bearing assets reduce the opportunity cost of non-yielding assets, like Silver, enhancing their attractiveness. US 10-year Treasury yields fall to 4.56%. US Treasury yields have fallen as traders hope the Federal Reserve (Fed) may cut interest rates at the May policy meeting.
According to the CME FedWatch tool, the probability that the Fed will cut interest rates in May has decreased to 53% from 63% a week ago.
Silver technical analysis
Silver price struggles near the ascending trend line around $30.80, which is drawn from the February 29, 2024 low of $22.30 on a daily time frame.
The white metal discovered strong buying interest near the 200-day EMA around $29.45, but struggles to stay above the 50-day EMA, which is around $30.30.
The 14-day Relative Strength Index (RSI) faces pressure near 60.00. A new bullish momentum would be triggered if it manages to break above 60.00.
Silver daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
