Silver Price Forecast: XAU/USD sees downside below $30.00 as its safe-haven demand diminishes

LONDON (November 26) Silver price (XAG/USD) rebounds after discovering a temporary support near the psychological support of $30.00. The white metal gains an interim ground as the US Dollar (USD) retreats. However, its outlook has weakened as its safe-haven demand weakens on potential de-escalation in the war between Israel and Iran.

Israeli Ambassador Mike Herzog told on Israeli Army Radio that a ceasefire deal to end fighting between Israel and Lebanon-based Hezbollah fighters could be reached “within days”, AlJazeera reported.

Potential truce talks have diminished safe-haven demand for precious metals, such as Silver. However, the overall safe-haven appeal has not been extinguished as the war between Russia and Ukraine remains intact.

Meanwhile, an upside-down move in the US Dollar (USD) has resulted in a slight recovery in the Silver price. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surrenders gains after a strong opening and drops to near 107.00.

The US Dollar opened on a strong note after President-elect Donald Trump threatened to raise import tariffs by 25% on Canada and Mexico and an additional 10% above the already mentioned 60% on China.

In Tuesday’s session, investors will focus on the Federal Open Market Committee (FOMC) minutes of the policy meeting held on November 7, which will be published at 19:00 GMT. In the policy meeting, the Fed reduced interest rates by 25 basis points (bps) to 4.50%-4.75% and officials were confident that inflation remains on a sustainable track towards the bank’s target of 2%.

FXStreet