Silver Price Forecasts: XAG/USD corrects lower from $67.00 resistance area

Silver (XAG/USD) saw a price correction lower on Tuesday, falling below $64.50 after a rejection of its seven-week highs near $66.60 on Monday. The cautious market mood was supported by the ongoing US-Iran peace negotiations and hawkish comments from Federal Reserve officials. Precious metals faced challenges due to stalled negotiations, with oil prices rising and the Strait of Hormuz remaining closed.

Cleveland Fed President Beth Hammack's statements on Monday, affirming that the current monetary policy was not hurting the economy and hinting at multiple rate hikes, added to the bullish tone, triggering hopes of a September rate hike. Technical analysis indicated key support at $63.30, where XAG/USD had reached the target of a bullish Head & Shoulders pattern.

Momentum indicators showed easing but remained bullish, with RSI near 60 and MACD above zero. Bears were expected to test the former resistance area now as support, around $63.30. A drop below this level would shift focus to the August 6-7 low of $61.00. On the upside, initial resistance was at the two-month high of $67.17, followed by the 200-day SMA at $71.38 and mid-June highs around $71.50.

Silver's value is influenced by factors like geopolitical instability, recession fears, interest rates, and the US Dollar. As an industrial metal, its price can also be affected by industrial demand, mining supplies, and recycling rates. Its relationship with Gold, through the Gold/Silver ratio, can provide insights into relative valuation.