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

Official market data from TradingView and industry sources show silver trading at $34.45 per ounce on June 4, 2025, after a volatile 24 hours.

The price peaked at $34.65 before consolidating just below $34.50, reflecting a market in the grip of both strong industrial demand and ongoing supply constraints.

The rally began late yesterday when silver broke decisively above $33.80, a move supported by robust buying interest and record-setting ETF inflows.

London vaults saw over 29 million ounces enter a major ETF last week, a figure confirmed by official vault data.

This surge in institutional demand coincided with persistent supply deficits, as major producers—Mexico, China, and Peru—struggled to increase output.

The Silver Institute’s 2025 survey highlights a fifth consecutive annual deficit, with the gap narrowing to 117 million ounces but still signaling systemic underproduction.

Industrial demand remains the central story. China’s wind and solar capacity expanded by 60 gigawatts in the first quarter, while Europe’s solar output jumped 30% year-on-year.

These developments directly increased silver consumption in photovoltaic and electronics manufacturing.

Meanwhile, automotive demand for silver continues to rise, driven by electrification and higher semiconductor content.

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

Technical analysis of the four-hour chart confirms the bullish structure. Silver trades well above its 50, 100, and 200-period moving averages, signaling a strong uptrend.

Price action sits above the upper Bollinger Band, indicating heightened volatility and overbought conditions.

The Ichimoku Cloud also shows price action firmly above the cloud, underscoring sustained bullish momentum.

However, the MACD on the two-hour chart reveals weakening momentum, with red histogram bars and a bearish crossover, suggesting buyer hesitation as the market approaches resistance at $34.78.

Volume increased sharply during the breakout, validating the move and reflecting real trading interest.

Support levels now stand at $34.05 and $33.67, while resistance remains at $34.78 and $35.00.

The Relative Strength Index (RSI) approaches overbought territory, warning of possible short-term pullbacks but not yet signaling a reversal.

Macroeconomic factors also played a role. The US dollar weakened overnight, and renewed geopolitical tensions—especially between the US and China—kept risk appetite low.

Investors sought hard assets as a hedge against uncertainty, further supporting silver’s price.

The OECD’s global growth downgrade added to risk aversion, while long-term Treasury yields remained elevated.

Fundamentally, the market faces its fifth straight year of deficit, despite a modest increase in mine output and recycling.

Demand for jewelry and silverware is falling due to high prices, but coin and bar investment is rebounding as investors diversify.

The market’s resilience, despite gold’s recent weakness, highlights silver’s dual role as both an industrial and investment asset.

In summary, silver’s current price reflects a market shaped by strong industrial demand, persistent supply constraints, and technical signals of both strength and caution.

The next move depends on whether buyers can push through the $34.78 resistance or if short-term profit-taking will trigger a pullback.

The underlying fundamentals suggest that any correction may prove temporary as long as the supply deficit and industrial demand persist.

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