Market risk appetite declined, and silver fell below $58, awaiting guidance from US employment data.
2026-07-01 14:57:27
Silver prices weakened in Asian trading on Wednesday, falling nearly 1%, with spot prices dropping below $58 per ounce . Market sentiment was affected by renewed uncertainty in US-Iran relations, with investors questioning the sustainability of geopolitical easing, thus weakening short-term support for the precious metal.
From a geopolitical perspective, negotiations between the US and Iran over the Strait of Hormuz remain highly uncertain. Market research indicates that after initial contact via Oman, the US has not agreed to a direct meeting with Iranian representatives, only expressing a willingness to communicate with the mediators. This stance has dampened market expectations for substantial progress in the negotiations.
The dispute over passage through the Strait of Hormuz remains a central focus. This passage carries approximately 20% of global energy transport, and any related fees or restrictions could drive up oil prices and indirectly reinforce global inflation expectations. Against this backdrop, the market is reassessing the Federal Reserve's policy path, further fueling expectations of "high interest rates remaining for a longer period."
Regarding interest rate expectations, if energy prices rise again due to supply concerns, it could prompt the Federal Reserve to maintain a tight monetary policy, thereby suppressing the performance of non-yielding assets such as silver. Silver is highly sensitive to changes in real interest rates and typically faces significant pressure in a high-interest-rate environment.
The market's short-term focus has shifted to US macroeconomic data. The market expects June ADP employment to increase by approximately 113,000 , slightly lower than the previous month's 122,000, while the ISM Manufacturing PMI is expected to remain at 54.0 . The subsequent non-farm payroll data will be a key variable determining the direction of the US dollar and precious metals.
Overall, silver is facing intensified competition between geopolitical risks and interest rate expectations, but in the short term it is still dominated by the US dollar and real interest rate expectations, with weak trend momentum.
From a daily chart perspective, silver has entered a low-level consolidation phase after its previous surge, with prices fluctuating repeatedly around $58, indicating a rebalancing of bullish and bearish forces. The current structure exhibits characteristics of "high-level consolidation + declining momentum," with resistance concentrated in the $59.20–$60.00 area. Failure to break through this range will likely maintain an overall weak and volatile bias. Initial support is at $57.20 , and a break below this level could lead to a further pullback to the $56 area.
From a 4-hour chart perspective, after breaking below the short-term moving average, the price entered a downward trend with limited rebound strength, indicating that short-term bears have a slight advantage. Momentum indicators remain neutral to weak, and the market is awaiting ADP and non-farm payroll data for direction. If the data strengthens expectations of a stronger dollar, silver may further test the lower support level; if the data falls short of expectations, it may trigger a technical rebound to around $59.
Editor's Summary : The current silver market is in a phase of oscillation between geopolitical uncertainty and interest rate expectations. Limited progress in US-Iran negotiations has led to fluctuating market risk sentiment, but the potential upside risk in energy prices has reinforced expectations that the Federal Reserve will maintain high interest rates, thus putting downward pressure on silver. In the short term, the core driver of the market will shift to the performance of US employment data. If the strengthening trend of the US dollar continues, silver will still face downward pressure; conversely, it may experience a phase of recovery, but the overall trend remains predominantly weak and volatile.
From a geopolitical perspective, negotiations between the US and Iran over the Strait of Hormuz remain highly uncertain. Market research indicates that after initial contact via Oman, the US has not agreed to a direct meeting with Iranian representatives, only expressing a willingness to communicate with the mediators. This stance has dampened market expectations for substantial progress in the negotiations.
The dispute over passage through the Strait of Hormuz remains a central focus. This passage carries approximately 20% of global energy transport, and any related fees or restrictions could drive up oil prices and indirectly reinforce global inflation expectations. Against this backdrop, the market is reassessing the Federal Reserve's policy path, further fueling expectations of "high interest rates remaining for a longer period."
Regarding interest rate expectations, if energy prices rise again due to supply concerns, it could prompt the Federal Reserve to maintain a tight monetary policy, thereby suppressing the performance of non-yielding assets such as silver. Silver is highly sensitive to changes in real interest rates and typically faces significant pressure in a high-interest-rate environment.
The market's short-term focus has shifted to US macroeconomic data. The market expects June ADP employment to increase by approximately 113,000 , slightly lower than the previous month's 122,000, while the ISM Manufacturing PMI is expected to remain at 54.0 . The subsequent non-farm payroll data will be a key variable determining the direction of the US dollar and precious metals.
Overall, silver is facing intensified competition between geopolitical risks and interest rate expectations, but in the short term it is still dominated by the US dollar and real interest rate expectations, with weak trend momentum.
From a daily chart perspective, silver has entered a low-level consolidation phase after its previous surge, with prices fluctuating repeatedly around $58, indicating a rebalancing of bullish and bearish forces. The current structure exhibits characteristics of "high-level consolidation + declining momentum," with resistance concentrated in the $59.20–$60.00 area. Failure to break through this range will likely maintain an overall weak and volatile bias. Initial support is at $57.20 , and a break below this level could lead to a further pullback to the $56 area.
From a 4-hour chart perspective, after breaking below the short-term moving average, the price entered a downward trend with limited rebound strength, indicating that short-term bears have a slight advantage. Momentum indicators remain neutral to weak, and the market is awaiting ADP and non-farm payroll data for direction. If the data strengthens expectations of a stronger dollar, silver may further test the lower support level; if the data falls short of expectations, it may trigger a technical rebound to around $59.
Editor's Summary : The current silver market is in a phase of oscillation between geopolitical uncertainty and interest rate expectations. Limited progress in US-Iran negotiations has led to fluctuating market risk sentiment, but the potential upside risk in energy prices has reinforced expectations that the Federal Reserve will maintain high interest rates, thus putting downward pressure on silver. In the short term, the core driver of the market will shift to the performance of US employment data. If the strengthening trend of the US dollar continues, silver will still face downward pressure; conversely, it may experience a phase of recovery, but the overall trend remains predominantly weak and volatile.
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