Silver Holds Firm as Supply Deficit and Industrial Demand Anchor Prices Near $34.50

Silver maintained its ground near $34.50 per ounce in early trading on June 5, 2025, as official market data and trading charts confirmed a period of consolidation following a sharp rally earlier in the week.

TradingView’s four-hour chart, published at 06:15 UTC, shows silver (XAG/USD) oscillating between $34.45 and $34.50, with price action stabilizing after a surge that saw the metal test resistance just below $35.

The previous 24 hours delivered little directional movement, with silver consolidating gains from June 2’s strong rally. That surge, triggered by a weakening US dollar and heightened geopolitical risks, propelled prices to multi-month highs.

Since then, the market has digested those gains, with momentum indicators such as the Relative Strength Index (RSI) moderating from overbought territory and price action flattening atop the 9-day moving average.

The 9-day, 20-day, 50-day, and 200-day moving averages all remain below current prices, confirming a bullish technical structure. The Ichimoku cloud indicator also sits well below spot, further supporting the prevailing uptrend.

Bollinger Bands on the chart have widened, reflecting the recent volatility, but the price now rides the upper band’s edge, suggesting a pause rather than a reversal.

Support levels at $34.05 and $33.40 have held firm, while resistance at $34.90 and $35.50 remains unbroken. Volume has normalized after the earlier spike, indicating traders are waiting for new catalysts.

ETF flows on June 3 showed notable outflows from major issuers, with iShares and Invesco reporting $1.12 billion and $616 million in redemptions, respectively.

Silver Market Outlook

However, these figures reflect broader asset allocation trends rather than silver-specific sentiment, as year-to-date inflows into commodity ETFs remain robust. Fundamental data from the Silver Institute and sector reports confirm that industrial demand remains the backbone of the market.

In 2024, industrial usage reached a record 680.5 million ounces, driven by solar, electronics, and electric vehicle sectors. The global silver market faces its fifth consecutive annual supply deficit in 2025, with a projected shortfall of 149 million ounces.

Supply growth, estimated at three percent, still lags behind demand, forcing the market to draw down above-ground stocks. Macroeconomic factors continue to shape sentiment.

The US Federal Reserve’s interest rate outlook, inflation data, and the dollar’s trajectory remain in focus. Meanwhile, persistent geopolitical tensions and the green energy transition sustain investment and industrial demand for silver.

In summary, the past day saw silver prices consolidate atop a strong technical and fundamental base, with the chart structure and supply-demand dynamics both suggesting further consolidation before any decisive move.

Market participants now watch for fresh signals that could drive the next leg, either toward breaking resistance or testing support.

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