Silver Price News: Silver Perks Up After Hitting Three-Month Low

Silver prices made modest gains on Thursday, taking a lead from a more bullish day in the gold markets.

Silver prices rose as high as $27.69 an ounce on Thursday, compared with around $26.60 an ounce in late trades on Wednesday.

Gold prices looked more positive on Thursday, rising above $2,420 an ounce after a bearish start to the week, and this provided a supportive backdrop for silver.

Silver’s dip to as low as $26.50 an ounce on Wednesday marked a three-month low, and this may have attracted some bargain-hunting, helping to lift the market on Thursday.

The grey metal has posted successively lower lows since May, forming a three-month bearish price channel, and leaving the market to assess where significant buy-side support will kick in. If prices do continue lower, horizontal trend line support at $26.00 an ounce may offer the next point of focus, based on the lows seen in early May.

On the bearish side, disappointing manufacturing data around the world in recent days has cast a dark cloud over industrial demand for silver. However, on the bullish side, silver prices should benefit from widely-anticipated interest rate cuts by the US Fed in the remainder of the year, with the markets expecting a first rate cut in September, followed by more cuts before the end of December.

And despite the short-term slow-down in manufacturing activity, a longer-term secular growth trend is expected to remain in place for industrial demand for silver which may serve to underpin prices. This is linked to a multi-year structural supply deficit and long-term expected growth in renewable and nuclear energy, as well as a need for silver in applications as diverse as defence technology, aerospace, electrical circuits, semiconductors, touch screens, batteries and energy storage, water purification systems and medical appliances.