Price action and technical levels
Silver (XAG/USD) edged up in early European trading on July 24, returning above $58.00 per troy ounce as the US Dollar trimmed some of its gains, with the pair quoted at $58.33. The bounce came after a 4.3% reversal on July 23 that left the metal near the lower end of a roughly two-week horizontal range. Technical levels frame the near-term map: resistance sits at the $60.70–$60.90 range top and the early-July highs near $62.50, while initial support emerges at the broken trendline around $56.50, followed by the year-to-date low of $54.77 and the 127.2% Fibonacci retracement of the mid-June selloff at $50.26. The 14-period Relative Strength Index hovered around 51 and the MACD held slightly in negative territory, pointing to a neutral rather than impulsive bias. During Asian hours earlier the same day, silver had been quoted closer to $57.60 per troy ounce.
Middle East conflict and oil-driven risk aversion
Risk sentiment deteriorated as reports of attacks on vessels in the Red Sea and renewed Houthi strikes on two Saudi oil tankers lifted Brent crude closer to the $100 mark, stoking fears of a fresh energy shock. The United States responded with a 13th consecutive night of military strikes on Iran. A separate Axios report said US President Donald Trump was weighing a "massive attack" on Iran and warned of "major military punishment" for both the Houthis and Iran if attacks continued. Higher US Treasury yields and a firmer US Dollar, both byproducts of inflation concerns tied to oil, weighed on yieldless silver.
Fed policy expectations pressure non-yielding assets
The CME FedWatch tool showed money markets pricing a 35.8% probability of a Federal Reserve rate hike in July and an 82.1% probability of at least a quarter-point move in September. With oil-driven inflation risks feeding into rate expectations, traders viewed silver as particularly vulnerable. The metal's lack of yield makes it sensitive to expectations of tighter US monetary policy, and rising Treasury yields amplified the headwind even as the dollar eased off intraday highs.
Industrial demand and the structural deficit
Manufacturing expectations across major economies were gradually stabilizing, with analysts highlighting industrial demand channels including electrification, power grids, semiconductors, industrial electronics, automation, AI infrastructure and solar installations as the structural supports for silver. The Silver Institute continued to project another annual market deficit, even as mine supply expands only gradually, leaving supply elasticity limited and reinforcing the metal's link to the global production cycle.
Regional manufacturing pulse
The Eurozone's manufacturing sector continued recovering from a multi-year contraction, with Reuters noting easing cost pressures and a recovery in new orders. US manufacturing remained above the expansion threshold, though markets awaited fresh PMI data to test whether the stabilization could extend into the second half of the year. Japan reported its fastest factory production expansion in several years, supported by electronics, advanced manufacturing and export-oriented industries. The European Central Bank held policy unchanged during the week, keeping focus on how financing conditions and energy costs transmit into industrial output.
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