Silver futures tumbled more than 2% during Thursday’s trading session on the COMEX exchange, with prices hitting $36.15 per ounce. The sharp decline follows a broader sell-off in precious metals as investors reassess market positions amid shifting economic indicators.
Dollar Strength Weighs on Commodity Prices
Market analysts attribute the drop to renewed strength in the U.S. dollar, which has put downward pressure on dollar-denominated assets. The ICE U.S. Dollar Index (DXY) climbed 0.3% earlier in the session, reducing the appeal of silver as an alternative investment. Traders also noted profit-taking after silver’s recent rally.
Industrial Demand Concerns Add to Bearish Sentiment
Further pressure came from concerns over softening industrial demand, particularly in key sectors like electronics and solar panel manufacturing. Silver, which has significant industrial applications, often reacts to shifts in global manufacturing outlooks. Recent economic data from major economies has fueled worries about slowing growth.
Technical Selling Accelerates Decline
Chart analysts observed that silver broke below key support levels, triggering automated sell orders and accelerating the downward momentum. Some traders suggest the metal could test the $35.50 level if the bearish trend continues. However, others see potential for a rebound if macroeconomic conditions shift.
Market Eyes Fed Policy for Future Direction
Investors are now closely watching upcoming Federal Reserve policy signals, which could determine whether the precious metals sell-off deepens or stabilizes. Silver’s volatility often increases during periods of monetary policy uncertainty, with traders weighing inflation risks against the prospect of higher interest rates.
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