iShares Silver Trust analysis: is it a good buy today?

iShares Silver Trust, which reflects the performance of the bullion silver price, has erased some of the gains amassed last week as investors await clarity from the US CPI data on Tuesday and talks on the Russia-Ukraine peace deal on Friday. 

While US dollar gains are weighing on the metal, its industrial and safe-haven demand have sustained its bullish momentum. Notably, silver price has rallied by about 30% year-to-date. Its appeal has seen it outperform gold; rallying by 33% over the past four months compared to its lustrous cousin’s 13%.

iShares Silver Trust halts to seek clarity in US CPI data

Geopolitical and economic uncertainties have heightened the demand for safe-haven assets in recent months, with silver emerging as a preferred alternative to the more expensive gold. Among the underlying factors is President Trump’s aggressive tariffs and its impact on the domestic and global economies. Late on Monday President Trump announced a 90-day extension of the US-China tariff truce set to end on Tuesday.

While an extension of this trade deal may ease the safe-haven demand, signs of a dovish Fed will likely offset the probable silver price losses. With the prevailing market conditions, the central bank is striving for a balance between the risks of a cooling job market and inflation that is still above its 2% target.

In the July US jobs report, the labor market slowed sharply with only 73,000 jobs being added. Besides, the figures for May and June were revised downwards by a total of 258,000 jobs. With this in mind, higher-than-expected CPI numbers will likely intensify the dovish Fed tilt. 

Experts expect the core CPI to have risen by 0.3% in July compared to the previous month’s 0.2% MoM. An environment of lower interest rates tend to be positive for non-yieldig assets like precious metals. 

Silver price technical analysis

iShares Silver Trust has retreated after rallying to a two-week high late last week at the crucial zone of $35. At the time of writing, it was trading at $34.18; hovering around the short-term 25-day EMA. 

Despite the pullback, it remains within the bullish channel that has guided its price movements since early April when Trump’s aggressive tariffs heightened demand for safe havens. Besides, it is still trading above the medium-term 50-day EMA; an indication that the bulls remain in control. 

However, its RSI of 50 points to range-bound trading in the short term. More specifically, iShares Silver Trust price may consolidate between $34.00 and $34.50 as the market awaits the US CPI data later in the day. 

In line with this inflation data, hints at a dovish Fed may give the bulls a chance to rebound further to last week’s high at $35. This bullish thesis will be valid for as long as the ETF continues to trade within the bullish channel. On the lower side, a drop below $34.00 will likely activate the support at $33.75.