Silver Price News: Silver Edges Lower After Wednesday’s Rally

Silver prices eased slightly lower on Thursday after clocking up gains of almost a dollar an ounce on Wednesday.

Prices were quoted at around $30.40 an ounce by Thursday afternoon, compared with $30.55 an ounce in late deals on Wednesday. The slight easing followed hefty gains on Wednesday when silver prices rallied from $29.52 to briefly trade as high as $30.72 an ounce – a two-week high.

Silver reacted positively on Wednesday to US data showing a surprise fall in services activity in June, which bolstered expectations that the US Fed will start cutting rates in the coming months. Looser monetary policy tends to support precious metals prices as it weakens the US dollar and cuts the opportunity cost of holding non-interest-bearing assets.

On the price charts, the period from late May through June has shown a clear bearish trend for silver, but the recent strength of buy-side support at around $29.00 has begun to challenge this short-term trend, suggesting silver may have the legs to stage an upside breakout.

Any drop back to the $29.00 an ounce level would offer a further chance to test this support area, while additional gains from here could see silver attempt to exceed the June 21 highs of around $30.84 an ounce.

Upcoming data releases include the monthly US Non-Farm Payrolls figures for June and the US unemployment rate, both due on Friday, for the latest pulse-check on the US economy. A planned speech by ECB President Christine Lagarde on Friday may also provide clues about future monetary policy in Europe, after the ECB made its first interest rate cut of 25 basis points in June.

Beyond that, the markets will be watching out for planned speeches by several US Fed officials on Tuesday next week, including from chair Jerome Powell, as the markets mull the probability of rate cuts in September or November.