#TradFi交易分享挑战 The Federal Reserve's hawkish expectations and a strengthening dollar suppress market sentiment, with silver falling to around $75 and declining for three consecutive days

On Monday during Asian trading hours, the price of Silver (XAG/USD) continued its pullback, dropping to around $75.30 intraday, marking the third consecutive trading day of decline. Current market concerns over a resurgence of global inflation are suppressing precious metals performance, while the continued strength of the dollar further diminishes silver's appeal.
Recently, ongoing escalation in Middle East tensions has driven rapid increases in international crude oil prices. Due to heightened transportation risks in the Strait of Hormuz, markets worry that global energy supplies could become further strained, reigniting concerns over rising global inflation. The rise in international oil prices has intensified inflation worries worldwide, putting significant pressure on the precious metals market.

As energy costs continue to climb, markets are reassessing the future monetary policy paths of major central banks. Especially with the hawkish signals recently released by the Federal Reserve, market expectations for rate cuts have notably shifted. Several Fed officials have recently stated that controlling inflation remains the core policy goal and emphasized that if price pressures persist, further rate hikes are possible.

According to data from the CME FedWatch tool, the market currently prices in about a 48% chance of the Fed raising interest rates again in December, up from only about 14% a week ago. The market's long-term bets on high interest rates have become a key factor suppressing silver. The market has quickly recalculated expectations of Fed rate hikes, pushing the dollar index to its highest level since April.

Since silver is a non-yielding asset, its attractiveness generally diminishes in a high-interest-rate environment. Meanwhile, rising U.S. Treasury yields and a strengthening dollar index further weaken demand for dollar-denominated precious metals. Additionally, global risk aversion has increased, driving funds into dollar assets. Currently, the US and Iran have yet to reach an agreement on a ceasefire and the reopening of the Strait of Hormuz, raising concerns about further deterioration of Middle East tensions.

The rising demand for dollar safe-haven assets continues to exert downward pressure on silver. Besides macro factors, recent adjustments by institutions regarding the supply and demand outlook for silver have also dampened market sentiment. UBS strategists recently downgraded their silver investment demand forecast, lowering their previous estimate of over 400 million ounces to about 300 million ounces. They believe that slowing industrial demand and increased mining supply are changing the supply-demand structure of the silver market.

Meanwhile, UBS expects the global silver supply gap to shrink significantly from the previously estimated approximately 300 million ounces to around 60-70 million ounces. The downward revision of demand forecasts by institutions has heightened concerns about the balance between supply and demand improving.

Since silver possesses both precious metal and industrial metal attributes, changes in global manufacturing demand have a significant impact on silver prices. Currently, there are concerns that a slowdown in the global economy could weaken industrial demand, thereby affecting silver's long-term upside potential.

From a technical analysis perspective, the daily chart shows that silver has broken below short-term moving average support, shifting from a previously strong upward trend to a high-level correction. A key short-term support zone is forming around $74; if subsequent declines break below this, the market could further test the $72 to $70 range.

On the 4-hour chart, short-term bearish momentum still dominates. The MACD indicator remains below the zero line, and the RSI is approaching oversold levels, indicating declining market risk appetite. However, due to ongoing tensions in the Middle East, some safe-haven buying support below may persist, so short-term volatility could remain high.

Currently, the silver market is influenced by a dual effect of "high interest rate suppression" and "safe-haven demand support." Although geopolitical risks theoretically favor precious metals, rising energy prices boost inflation expectations, which in turn reinforce market bets on the Fed maintaining high interest rates, thereby weakening silver's attractiveness. Additionally, the downward revision of institutional silver demand forecasts further dampens market sentiment. In the short term, the dollar trend, Fed policy expectations, and changes in global industrial demand will continue to dominate the direction of the silver market. $XAGUSD