Silver trades around $62 per ounce on Tuesday, not far from the 2026 low of $61.01 posted in March. King Dollar regained its crown after the Federal Reserve shifted to a hawkish stance at its June meeting, with easing tensions in the Middle East also helping.

As the XAG/USD pair approaches the critical threshold, sellers gain confidence and look for potential targets should a bearish breakout occur. In the meantime, it’s worth remembering the precious metal flirted with such a bottom earlier in June and attracted modest buying interest, which, anyway, met sellers ahead of the $ 70 mark, now a technical roof.

Federal Reserve aftermath

The Federal Reserve (Fed) held its first monetary policy meeting, chaired by Kevin Warsh, and as widely anticipated, officials kept the Fed’s Fund Rate unchanged, floating between 3.5% and 3.75%. But surprises were not missing. Policymakers now lean towards a rate hike before year’s end, a 180-degree change from the previous meeting in which a rate cut was still on the table.

Chair Warsh made it pretty clear that he does not believe in forward guidance and that decisions will depend on data. He also announced changes to most of what the Fed does to set monetary policy, and to the approach used to get there.

Still, rate-hike bets are actually taking their toll on Silver.

Middle East negotiations continue

The United States (US) and Iran signed an agreement last week, which brought major relief to financial markets. Oil prices plunged, with the barrel of West Texas Intermediate (WTI) hovering around $73, not far above pre-war levels. However, the deal is far from a complete roll-back of what happened in the last few months. Negotiations continue, with tensions revolving around Tehran’s willingness to accept nuclear inspections and the full reopening of the Strait of Hormuz. Vessels are indeed moving through, but Iran keeps demanding control of the critical passage. Also, tensions between Israel and Lebanon remain a sticky point to be solved.

Relief – and lower Oil Prices – are another factor playing in the USD’s favor.

XAG/USD Technical Outlook

The technical setup for XAG/USD hints at lower lows ahead. In the daily chart, the pair extends its slide below the 20-day, 100-day, and 200-day Simple Moving Averages (SMAs), with the shorter one about to cross below the longer one, both converging near the $70 level and reinforcing the strength of the resistance area. The same chart shows the Momentum indicator heads nowhere below its midline, while the Relative Strength Index (RSI) indicator aims firmly lower near 33, suggesting sellers remain in control despite the risk of a corrective bounce.

On the topside, initial resistance is clustered around the longer-term averages, with the 200-day SMA at $69.33 closely followed by the 20-day SMA at $69.38, forming the first significant cap for any recovery attempts. A sustained break above that zone would open the way toward the 100-day SMA at $76.71, where the broader bearish structure would likely be challenged. Once the year low gives up, investors will be looking for XAG/USD behavior around the $60 psychological threshold. Failure to bounce sustainably from the latter will open the door for a test of the $54.60 price zone, where the pair bottomed last December. Additional declines expose the $50 mark, where selling interest is likely to recede.

(The technical analysis of this story was written with the help of an AI tool.)

Silver price (XAG/USD) loses over 1% after registering modest gains in the previous day, trading around $64.50 per troy ounce during the Asian hours on Tuesday. The non-yielding Silver struggles amid a hawkish policy outlook at the Federal Reserve (Fed).

Last week, the US central bank opted to hold its benchmark interest rate steady between 3.50% and 3.75%. However, the updated economic projections and commentary from Kevin Warsh, presiding over his first meeting as Fed Chair, surprised the market by leaning more hawkish than anticipated. As a result, futures traders have fully priced in a 25-basis-point rate hike for the September meeting, with some pricing in a minor probability of a tightening move as early as next month.

The downside of the Silver price could be restrained amid progress in ongoing peace talks between the US and Iran, which helped ease concerns about inflation. According to a CNBC report on Tuesday, US Vice President JD Vance noted that negotiations have made “great progress,” despite some underlying friction. This followed Vance’s Monday announcement that Iran has agreed to readmit International Atomic Energy Agency (IAEA) inspectors. The optimism was mirrored by Iranian Foreign Minister Abbas Araghchi, who similarly confirmed that the Swiss dialogue has yielded “major progress.”

Precious metals, including Silver, have faced persistent downward pressure since the outbreak of the Middle East conflict in late February. Disruptions to energy flows through the Strait of Hormuz initially drove crude oil prices higher, intensifying market fears that central banks would keep interest rates elevated to curb sticky inflation.

The supply outlook shifted after Washington issued Tehran a 60-day license to sell oil on international markets. This regulatory relief has fueled expectations of a faster recovery in global crude supplies, potentially easing the inflationary pressures that have weighed heavily on safe-haven assets.