Silver prices were hit even harder. They dropped under $32 per ounce just after President Donald Trump declared a long series of reciprocal tariffs. Today’s announcement has triggered a tidal wave of selling in the silver market. Speculators are now scrambling to move on the “Buy the Rumour and Sell the News” axiom. This is a powerful statement on the close relationship silver prices have with gold prices. Both precious metals often react in tandem to economic news.
On Thursday, again during North American trading hours, silversmashing up nearly 5% as it tested levels under $32. And investors are jittery over the fall. Silver is essential for most industrial usages, in particular electronics and photovoltaic solar energy. The recent announcement and ramping up of added import duties on China has taken the so-called “demand outlook” for the metal from bad to worse.
The Impact of Tariffs on Silver Demand
Lang is rightfully well-known for his incredible ability to wield silver. Its electrical conductivity is a close second after silver and indeed can beat copper and gold in certain applications. This property makes it critical to numerous technological innovations and manufacturing processes. The imposition of higher tariffs on Chinese imports, a significant factor in global trade, has adversely affected the demand outlook for silver.
The tariffs have sowed instability across an already volatile market, contributing to a dramatic drop in silver prices. Investors and speculators are understandably keeping a close eye on how these tariffs might impact production costs and demand for silver across silver’s largest industries. Tariffs have created a double whammy on manufacturers, driving up costs. In retaliation, they could reduce their use of silver, forcing prices to plummet further.
Additionally, the market’s response to Trump’s announcement shows just how reactive silver can be to geopolitical news. As a yieldless asset, silver tends to do well during periods of low interest rates. Nonetheless, escalating tariffs and accompanying economic worry could raise interest rates, leading to a drop in silver’s attractiveness.
Technical Analysis of Silver Price Movements
The detailed chart analysis of silver’s price action suggests important turning points that indicate underlying bullish/bearish sentiment and confusion among market participants. Silver made a new near-term low after failing to touch the upper, flat border of the Ascending Triangle chart formation. This bullish pattern on the daily time frame coincides with the high on October 22 of $34.87. This failure not only shows a loss of bullish momentum, but is part of the sharp decline in prices.
Traders are confused about the recent uptick and its potential direction. They determined the upward-sloping upper border of this Ascending Triangle pattern from the Aug 8 low of $26.45. In bear baiting when resistance levels are holding, it is usually a sign that market sentiment is weak. We have witnessed this scenario unfold in the last several trading days.
Silver has also fallen below the 20-day Exponential Moving Average (EMA) of about $33.35. Regardless of the implications, this shift represents a definite move to a more bearish near-term trend. Market participants are scrambling to find other support levels. The February 28 low of $30.82 is the key breakout point for silver prices going forward.
Future Outlook for Silver Prices
Going forward, analysts have tempered expectations for silver’s course, in large part due to persistent global economic woes. The October 22 high of $34.87 is the most important level to overcome for any significant rebound in silver prices. Traders will closely monitor economic indicators and potential changes in tariff policies, which may significantly impact silver’s demand and pricing dynamics.
No amount of recent declines can take away from silver’s incredible long-term performance. It might be able to rebound if interest rates significantly lower or if geopolitical tensions subside. Adding to the demand, during periods of high economic uncertainty, investors tend to invest in precious metals including silver. They consider these metals to be safe-haven assets with consistent, dependable value.