Silver Price Forecast: XAG/USD rebounds to near $36.70, US-China trade talks in focus

LONDON (June 10) Silver price (XAG/USD) claws back initial losses and rebounds to near $36.70 from the intraday low of $36.30 during European trading hours on Tuesday. The white metal recovers amid uncertainty over the outcome of trade talks between the United States (US) and China in London, which have entered the second day.

During European trading hours, the White House has signaled that trade discussions between the two nations are going well and negotiation will continue the entire day.

Theoretically, the optimism on Sino-US-trade discussions should diminish the demand of safe-haven assets, such as Silver.

Meanwhile, the US Dollar Index (DXY) trades calmly around 99.70, awaiting the US-China meeting minutes.

On the domestic front, investors await the US Consumer Price Index (CPI) data for May, which will be released on Wednesday. The inflation data is expected to show that price pressure grew at a faster pace.

Signs of accelerating inflationary pressures would allow the Federal Reserve (Fed) to maintain interest rates at their current levels for lone

The appeal of the Silver price increases in a high-inflation environment, higher hogher interest rates by the Federal Reserve (Fed) bode poorly for non-yielding assets, such as Silver.

Silver technical analysis

Silver price advances to near $36.20 after breaking above the key resistance plotted from the October 22 high of $34.87, which will act as a key support now. Advancing 20-day Exponential Moving Average (EMA) near $34.34 suggests that the near-term trend is bullish.

The 14-day Relative Strength Index (RSI) jumps above 70.00, indicating a strong bullish momentum.

Looking up, psychological level of $40.00 will be the major resistance for the Silver price. On the downside, the October 22 high of $34.87 will act as key support for the asset.

FXStreet