Silver Price News: Silver Rebounds to One-Week High

Silver prices made gains for a second day on Tuesday, rebounding back above the $31.00 an ounce mark as the markets increased bets on upcoming interest rate cuts.

Prices climbed to an intraday high of $31.21 an ounce, compared with around $30.65 an ounce in late trades on Monday. That was the highest price for silver since November 25^th.

US interest rate cut seen in coming weeks

The markets appear to be increasing bets on an interest rate cut by the US Fed at its upcoming meeting on December 18th – a supportive factor for non-interest-bearing assets like gold and silver. Data from interest rate traders suggests a 74% probability of a 25-basis point cut at the December meeting, compared with around 65% a few days ago.

Technical analysis

On the technical charts, a potentially supportive price signal has come from a ‘double bottom’ that emerged in recent weeks when prices twice tested downside support at around $29.90 an ounce on November 14^th and again on November 28^th. A rally above $31.30 an ounce would help solidify this as a bullish indicator. This level also coincides with rising oblique minor support at $29.90 an ounce, which helps explain silver’s reluctance so far to break below this level. Silver also crossed the 20-day moving average on Tuesday at $30.77 an ounce. Should this renewed positive momentum continue, silver may encounter rising oblique minor resistance at $31.55 an ounce.

Upcoming events

Looking ahead, the markets will get an update on Brazil’s industrial production for October on Wednesday, followed by monthly US services PMI figures and factory orders, for the latest signals on the health of the US economy. A speech by US Fed chair Jerome Powell later in the evening will be closely watched, followed by Thursday’s weekly US initial jobless claims figures, for the latest pulse check on the labour market.