Silver (XAG) Forecast: Rises on Safe-Haven Appeal, but Capped by China Demand Uncertainty

Silver Edges Higher, Gold Outpaces as Tariff Concerns Persist

Silver prices posted modest gains on Tuesday but remained overshadowed by gold, as uncertainty over potential U.S. tariffs on China tempered bullish momentum. The metal traded above its 50-day and 200-day moving averages at $30.90 and $30.03, respectively. A breakout above last week’s high of $30.98 could pave the way for a rally toward the $31.81–$32.33 range. Conversely, a failure to hold the 200-day moving average may trigger downside momentum.

At 12:33 GMT, XAG/USD is trading $30.57, up $0.04 or +0.12%.

Dollar Softness Lends Support to Silver

The U.S. dollar index dipped 0.6%, hitting a two-week low, bolstering silver’s appeal to foreign investors by making it more affordable in other currencies. Later in the session, the dollar recovered slightly after President Trump floated a potential 25% tariff on imports from Mexico and Canada. Despite this rebound, silver maintained support as traders sought safe-haven assets amidst growing economic and geopolitical risks.

Trade Policy Uncertainty Fuels Safe-Haven Demand

Trump’s tariff rhetoric extended beyond North American trade partners, with suggestions of measures against China if a TikTok-related deal falls through. Such actions could escalate trade tensions, potentially disrupting global markets and increasing silver’s appeal as a hedge.

Historically, tariffs on China have heightened concerns over supply chain disruptions and slowed economic activity, factors that often spur demand for precious metals like silver.

Meanwhile, U.S. Treasury yields declined as traders digested Trump’s slew of executive orders and their implications for economic stability. This decline reinforced risk-off sentiment, drawing further interest in silver and gold as safe-haven assets.

Market Forecast: Key Levels to Watch for Silver

Silver’s next significant move hinges on a break above the $30.98 resistance level, which could drive prices toward the $31.81–$32.33 zone. Ongoing tariff uncertainty—especially regarding China—adds to silver’s safe-haven demand, but traders should also monitor U.S. economic data, such as PMI releases and housing statistics, for potential catalysts. On the downside, breaching the 200-day moving average could trigger increased selling pressure.

For now, silver’s resilience reflects its dual role as an industrial metal and a hedge against market instability, keeping traders focused on its technical and fundamental drivers.

More Information in our Economic Calendar.