Silver Price Action Hangs on Diplomacy Outcome and Technical Levels
LONDON (February 4) After reviewing the movements of the silver futures in a daily chart since the beginning of this year, I find that the silver futures historically lead either a rally or a slide in precious metals.
On Wednesday, silver futures, after opening at $84.457, and testing the day’s low at $84.300 with a day’s high at $90.423, are trading at $89.925, after experiencing a surge of approximately 8%.
Undoubtedly, this reversal in the silver futures looks quite attractive in response to the steep fall of approximately 41.81% within two trading sessions, after testing a record peak at $121.993 on Jan. 29, 2026.
And, after testing the lows at $71 on Feb.2, 2026, after finding strong support at the 50 EMA ($74.883) constantly maintaining reversal since Tuesday, despite a bearish formation of ‘Three Black Crows’, which could evaporate this reversal anytime as the silver futures are trading much below the tested high, just below the immediate resistance at $90.701.
Undoubtedly, silver futures are currently trying to hold the significant support at the 20 EMA ($88.273) while the next resistance is at the 9 EMA ($91.655).
Undoubtedly, silver futures could remain under bearish pressure as the prevailing tension on the U.S.-Iran tussle persists until the markets eye the efforts to resolve this through personal meetings between the diplomats of both countries.
However, I find that currently prevailing uncertainty will continue up to Friday, till the outcome of this meeting, and any positive outcome could once again repeat last Friday’s selling spree, once again while if this meeting ends without any solid outcome, some sell off could be there.
I find that the silver futures could experience extremely volatile moves if this meeting fails on Friday.
While having a look at the current position of spot gold and silver futures ratio in a daily chart, indicating some exhaustion despite trading at the significant support at 56.50 could surge upward to test the immediate resistance at 59.93 where a breakout will result in extensive selling pressure on Silver futures as the inverse correlation between them indicates the next directional move in advance.
Moreover, if the prevailing tension between the two eases on Friday after a successful deal, silver futures could repeat Friday’s fall once again.
Disclaimer: Readers are advised to take any position in silver at their own risk, as this analysis is based only on observations.
Investing.com
