Silver Price Pullback: XAG/USD Retreats from Record $86.00 After Trump-Zelensky Peace Talks

rugdoc.eth · 2026-01-04T12:24:03+00:00

Silver prices have fallen sharply from recent highs, influenced by optimism surrounding a potential peace settlement in Ukraine after Trump's meeting with Zelensky. Despite this retreat, rising tensions in the Pacific could reignite demand for precious metals. The current technical indicators suggest that the market is in correction mode rather than a full reversal.

rugdoc.eth

2026-01-04 12:24:03

Abstract generation in progress

Silver has given back over $10 from its all-time peak, sliding toward $74.00 as peace optimism cools the precious metals rally. Traders watching silver CFD prices are experiencing a reality check. After hitting a historic high near $86.00 early Monday, XAG/USD has retreated sharply to the $74.00 region—a $12 swing that caught many off guard. The culprit? Renewed hopes of a Ukraine peace settlement following Trump’s Sunday meeting with President Zelensky, where the US leader signaled that resolution might be “much closer” than previously thought.

When peace looks probable, safe-haven assets take a backseat. That’s the market dynamic playing out right now. Precious metals like silver tend to thrive in uncertain times, but optimistic geopolitical headlines—even tentative ones—trigger profit-taking. Trump’s comments have shifted investor psychology from “expect the worst” to “maybe this resolves,” and silver CFD price action reflects that sentiment shift immediately.

However, the peace narrative faces a counterweight from the Pacific. China has announced major military drills encircling Taiwan, with multiple vessels spotted in Taiwanese waters. This escalation in an already tense region could reignite demand for precious metals as uncertainty hedges. If tensions spiral, the silver pullback might prove temporary.

Technical Snapshot: A Reset from Overbought Extremes

At $74.92 on the 4-hour timeframe, silver is testing the 21-period simple moving average (SMA) near $74.00—currently acting as support. The Relative Strength Index (RSI) has retreated to 54.79 from overbought readings, signaling momentum has cooled. The Moving Average Convergence Divergence (MACD) is rolling over toward zero, confirming that the intense upside push has lost steam.

Support levels below the 21-period SMA sit at $72.60 (December 24 resistance turned floor) and the $69.60–$70.20 zone where the 50-period SMA, December 24 low, and December 22 high converge. Buyers attempting to re-ignite the rally will face the psychological $80.00 barrier first, before tackling the prior all-time high of $85.87.

The technical picture suggests silver CFD traders are in correction mode rather than reversal mode—a temporary shakeout before the next directional move becomes clear.

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