Overview of the Market The price of silver (XAG/USD) saw a decrease on Monday, hovering close to $28.97 and reaching a low of $28.73. This drop was influenced by positive market sentiment, which lessened the demand for this safe-haven metal. Nevertheless, the decline might only be temporary due to anticipated accommodative monetary policies by the Federal Reserve (Fed). Ongoing geopolitical tensions, including conflicts in the Middle East and the prolonged Russia-Ukraine war, might continue to provide support to silver prices. Traders are expected to exercise caution until there is more clarity on the Fed’s stance. Attention is now directed towards the impending release of the FOMC meeting minutes on Wednesday and a speech by Fed Chair Jerome Powell at the Jackson Hole Symposium, which could offer additional insights. Silver Reaches High of $29.12 as Dovish Fed Weakens Dollar and Tensions Increase The weakening of the dollar was driven by expectations of a dovish Federal Reserve rate cut. Recent data, such as the Producer Price Index (PPI) and Consumer Price Index (CPI), indicating a decrease in inflation, reinforced expectations for a 25-basis-point rate cut in September. Despite positive U.S. Retail Sales reducing concerns of a recession, reports on inflation fueled speculations about Fed easing, resulting in a weaker dollar and pushing silver prices to a peak of $29.122. The University of Michigan’s Consumer Sentiment Index rose to 67.8 in August, with inflation expectations remaining stable. Federal Reserve officials’ comments also contributed to the dollar’s decline. Chicago Fed President Austan Goolsbee suggested that the economy is not overheating, advocating for caution in maintaining restrictive policies. San Francisco Fed President Mary Daly emphasized the need for a gradual approach to lowering borrowing costs, aligning with market expectations of imminent policy easing. Initially, this surge pushed silver prices above $29.122, but a shift towards risk-taking sentiment is now steering investors away from safe-haven assets like silver. Middle East and Ukraine Tensions Propel Silver Prices Upward Ongoing conflicts in the Middle East and the Russia-Ukraine war are sustaining silver prices. Recently, Hamas rejected terms for a hostage release-ceasefire deal in Doha, heightening tensions. Meanwhile, Russia pledged retaliation following Ukraine’s cross-border attack on Kursk, which marked… Short-Term Prediction There might be volatility in the price of silver (XAG/USD) around $29.00, with resistance at $29.03. A breakthrough at this level could trigger a bullish movement, but there are risks if prices drop below the support at $28.43. Technical Outlook for Silver Price (XAG/USD) Silver (XAG/USD) is currently trading at $28.97, slightly below the pivot point at $29.09. The metal is encountering notable resistance around $29.03, where a triple top pattern has emerged. The resistance level at $29.03 is crucial; a breach above it could lead to a bullish breakout driving the price towards higher levels, with immediate resistance at $29.64, followed by $30.07 and $30.60. On the downside, immediate support lies at $28.43, with additional support at $27.98 and $27.29. Key levels to monitor for potential shifts in the trend include the 50-day EMA at $28.02 and the 200-day EMA at $28.60. The outlook remains bearish below $29.09, but surpassing this level could enhance bullish momentum, resulting in further price gains.