Silver Futures Weakens Amid Softening Tariff Stances by President Trump
Despite a surge in precious metals and energy prices on Friday, concerns over the demand for safe havens have risen following US President Donald Trump’s announcement of reciprocal tariffs next week. Contracts for white metals suggest a potential selling spree in the near future.
Japanese Prime Minister Shigeru Ishiba remains optimistic about avoiding higher US tariffs, as Trump acknowledges Japan’s significant investment in the US and the job opportunities it creates. This optimism stems from Trump’s recent softening stance on tariffs, possibly realizing the negative impact of his hardline approach.
The suspension of tariffs against Mexico and Canada on Feb 4 could be seen as an initial sign of flexibility from Trump, indicating a willingness to adjust based on the current circumstances. This shift in trade war dynamics hints at a bearish trend in the precious metals and energy markets.
Technical analysis of silver futures shows a bearish outlook, with the formation of an ‘Evening Doji Star’ on the weekly chart signaling potential weakness in the coming weeks. Despite attempts to break above the $33 resistance level on the daily chart, silver futures struggle to sustain momentum.
Traders should be aware of the changing tariff landscape and its impact on precious metals. The degree of flexibility in imposing tariffs could alleviate fears of a trade war in the short term, while retaliatory tariffs remain a key factor to watch.
Disclaimer: Readers are advised to trade silver futures at their own risk based on the observations provided in this analysis.