Silver Price Rebounds from Multi-Year High as Markets Await Key Developments

U.S.–China Negotiations Resume in London

The first round of trade negotiations between the United States and China has begun in London, one month after both sides agreed to a temporary truce during talks in Geneva. The U.S. administration has signalled its willingness to ease certain restrictions on China, contingent on China lifting its export controls on rare earth minerals to the U.S.

However, the American offer notably excludes high-end technologies, particularly those related to artificial intelligence developed by Nvidia. A key motivation behind the U.S. stance is the strategic importance of rare earths, especially for the military sector. China’s export limitations on these critical materials were key in persuading the Trump administration to relax its position and suspend a large portion of tariffs imposed on Chinese goods earlier in April.

U.S. Inflation in Focus

Investors are now closely watching the release of the U.S. Consumer Price Index for May, scheduled for tomorrow at 4:30 PM UAE time. Forecasts suggest a rise in the YoY inflation from 2.3% in April to 2.5% in May, while core inflation (excluding food and energy) is expected to edge up from 2.8% to 2.9%.

This follows last week’s jobs report, which showed the U.S. economy added 139,000 jobs in May (beating expectations of 126,000) with the unemployment rate holding steady at 4.2%.

If inflation continues to rise alongside steady job growth, the Federal Reserve is likely to maintain its current wait-and-see approach. This stance is expected to remain in place until the end of the tariff suspension period set by the Trump administration, which allows time for broader international negotiations. The suspension ends in July, after which the Fed will evaluate the economic impact of the tariffs based on inflation and unemployment data. As such, monetary policy is expected to remain unchanged until at least the September meeting, despite President Trump’s ongoing criticism of Fed Chair Jerome Powell.

Silver Price at Multi-Year Highs

Silver prices surged to their highest levels since 2012, reaching $36.87/oz yesterday before pulling back on profit-taking. The metal is currently trading within a tight zone between $35.40 and $37.00. A daily close above the high end of this zone signals a strong bullish momentum and could pave the way for further gains possibly towards $38.00 per ounce. However, the resistance level at $37.50 should be considered.

Key Levels to Watch in a Bearish Scenario

The Relative Strength Index remains in overbought territory above 70. Therefore, a drop below this level could indicate a continued exit by bullish traders. In that case, the silver price may retreat toward the low end of the current trading zone mentioned above.

A daily close below $35.40 signals the start of a correction move, potentially driving prices down toward $32.66. Along the way, key support levels of $34.85 and $33.44 should be monitored.

Sliver price – Daily Chart

Chart Source: ADSS Platform