Silver Surges Despite Early Dip: US Economic Data Fuels May 15 Rally
Silver prices staged a remarkable recovery on May 15, closing 0.79% higher at $32.48 after plunging to a six-week low earlier in the session.
Trading data from Capital.com shows the white metal rebounded sharply from an intraday low of $31.65, the lowest level since April 11, as traders seized the buying opportunity amid weaker-than-expected US economic reports.
The dramatic turnaround began during European trading hours as disappointing US data flooded markets. Empire Manufacturing for May contracted for the third consecutive month at -9.2, worse than the expected -8.0.
Meanwhile, the US retail sales control group posted a surprising -0.2% decline, missing forecasts of 0.3% growth. This string of underwhelming economic indicators fueled speculation about Federal Reserve rate cuts.
Traders aggressively bought silver’s morning dip ahead of Fed Chair Jerome Powell’s anticipated speech on the monetary policy framework.
The white metal rallied throughout afternoon trading, erasing early losses to finish strongly positive despite initial pressure from US-China trade developments.
COMEX silver for May delivery ultimately gained 25.50 cents per troy ounce, marking a victory for bulls who defended the critical $31.65 support level.
Volume spiked during the recovery phase, confirming strong buying interest at lower levels. Asian trading overnight saw continued consolidation as markets digested Thursday’s price action.
Silver Market Update
Silver traded in a tight range between $32.25-32.50 before settling at the lower end of this band on May 16 morning at $32.39. Technical analysis now shows silver trading between its 50-day and 100-day moving averages.
The 50-day MA, currently at $32.44, is serving as immediate overhead resistance. The daily chart displays a critical triangle formation developing with support established at $32.01, $31.92, and the recently tested $31.65 level.
The gold-to-silver ratio has pulled back below 100 to approximately 98.50, improving from April’s spike above 105 that followed escalating trade tensions. Technical analysts indicate this ratio must drop below 97.50 before potentially returning to pre-April trading ranges.
“Yesterday’s recovery demonstrates strong underlying demand despite geopolitical headwinds,” notes Praveen Singh, associate vice president at Mirae Asset Sharekhan.
“Disappointing industrial production figures provided fundamental support as markets recalibrate rate cut expectations.” COMEX silver inventory stands at 502.874 million ounces as of May 14, hovering near the all-time high of 505 million ounces recorded on May 12.
Global silver ETF holdings currently total 735.52 million ounces, showing a 2% increase year-to-date despite recent price volatility.
Looking ahead, market participants now focus on today’s upcoming US housing starts, Import Price Index, and University of Michigan sentiment data.
The technical picture suggests silver must clear resistance at $32.76 and $33.25 to confirm yesterday’s bullish reversal and potentially target the $34.25 level that analysts have identified as the next significant objective.
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