Silver is attempting to stabilize around the $58 mark after three consecutive sessions of losses, as traders weigh the dual pressures of escalating geopolitical tensions in the Strait of Hormuz and lingering Federal Reserve rate-hike risks. The precious metal edged up to approximately $58.30 per ounce during Asian trading on Thursday, recovering slightly from a sharp pullback, but the broader outlook remains challenging.
Hormuz Tensions Keep Oil Risk Alive
The modest rebound follows renewed concerns over shipping security in the Strait of Hormuz, after multiple tankers were struck by projectiles and U.S. forces launched fresh strikes against Iranian targets. President Trump declared the interim agreement with Iran "over" and warned of further military action, leaving markets on edge about potential disruptions to energy flows through the strategic waterway. The U.S. also revoked a license that had allowed Iran to sell oil, compounding supply fears.
Crude prices surged as traders added a fresh geopolitical risk premium. For silver, the implications are twofold: while the metal can attract safe-haven bids during times of conflict, higher oil prices risk feeding inflation, which could strengthen the U.S. dollar and reduce the likelihood of the Federal Reserve easing monetary policy. That dynamic tends to weigh on non-yielding assets like silver.
For more on the oil market reaction, see Oil Surges 5.7% as Trump Declares US-Iran Ceasefire Collapsed, Strait of Hormuz at Risk.
Technicals Keep Silver Under Pressure
Despite the small uptick, silver's chart remains fragile. XAG/USD is trading below its short-term moving averages, indicating that sellers still hold the upper hand after the recent three-day decline. The first major resistance level sits near $60 per ounce. A sustained move above that zone would alleviate some downward pressure and open the door for a recovery toward $61.50 and then $63. However, until buyers reclaim those levels, any rallies may attract selling interest.
On the downside, the $57.50–$58 area serves as immediate support. A clear break below that range would weaken the recovery attempt and expose the recent lows near $55.60. Momentum indicators are no longer deeply oversold, suggesting that silver could still have room to fall if dollar strength or rate-hike fears persist.
For a broader perspective on silver's recent price action, see Silver Bulls Reclaim $60, but Friday's Jobs Report Will Determine Next Move.
Fed Split Keeps Traders Cautious
The Federal Reserve's June minutes revealed a divided committee, with several officials seeing a case for raising rates, though the central bank ultimately kept the federal funds target range at 3.50%–3.75%. According to CME FedWatch, traders have increased the probability of a near-term rate hike following the latest escalation in the Middle East.
That leaves silver vulnerable. Unless oil prices cool or the dollar weakens, any rebounds are likely to remain shallow. For now, the $58 level represents a stabilization point rather than a confirmed floor. Investors should monitor upcoming economic data and geopolitical developments closely.
For additional context on the interplay between metals and macro factors, see Silver Breaks Above $62 as Weak US Jobs Data Dents Dollar, Fed Hike Odds.
This article is for informational purposes only and does not constitute financial advice.
