Silver Price Drops Toward $35.50 as Geopolitical Tensions Rise and Profit-Taking Intensifies

The Silver price (XAG/USD) extended its downside correction on Thursday, losing approximately 1.5% in early European trading to hover around $35.50. This marks the third straight session of losses after hitting a 13-year high of $36.90 earlier in the week. Despite rising global uncertainty and a weakening US Dollar (USD), Silver failed to maintain its bullish momentum.

Middle East Tensions Drive Volatility

According to The New York Times, US and European intelligence view Israel as preparing for an imminent strike on Iran. In response, the US government is reportedly reducing diplomatic staff in the region, highlighting the seriousness of the geopolitical climate.

Typically, Silver—as a safe-haven asset—benefits during times of uncertainty. However, this round of tensions is being met with broad profit-taking, capping the metal’s potential upside.

Technical Snapshot

Resistance: $36.90 (multi-year high), $36.20
Support: $35.50 (current level), $34.85 (next psychological level)

The inability of XAG/USD to capitalize on USD weakness indicates temporary market exhaustion, particularly as traders look to lock in gains after a historic surge.