Silver (XAG/USD) Tests Key Trend Support Amid Cooling Geopolitical Tensions

Silver (XAG/USD) Tests Key Trend Support Amid Cooling Geopolitical Tensions

Silver (XAG/USD) is showing signs of technical weakness on Wednesday, as price action consolidates near $35.75, down 0.46% on the day. The metal remains within Tuesday’s trading range, reflecting a subdued tone as safe-haven demand recedes following signs of a ceasefire between Iran and Israel.

Easing Geopolitical Tensions Weigh on Silver

Recent gains in Silver were largely fueled by geopolitical uncertainty. However, with Middle East tensions de-escalating, investors are unwinding some of their defensive bets. This shift in sentiment is putting pressure on precious metals, traditionally favored during risk-off environments.

Technical Setup: Support Under Threat

Silver’s current price action is testing the ascending channel support that has guided the bullish trend since mid-April. This zone coincides with the 20-day Simple Moving Average (SMA) and mid-Bollinger Band near $35.71, forming a critical technical confluence. A daily close below this level could shift the near-term bias bearish, with $34.00 as the next likely support target.

Momentum Signals Exhaustion

A bearish RSI divergence has emerged — while Silver recently printed multi-year highs near $37.00, the Relative Strength Index peaked earlier and is now trending lower, down to 56. This is a potential red flag for bullish momentum, suggesting traders may begin profit-taking or shifting to a more cautious stance.

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