Silver Forecast: 66.89 Rebounds Sharply From the 63.30 Low

• Silver trades at $66.8855, flat over the past day after rebounding hard from the $63.30 shelf.
• Its two demand engines are pulling in opposite directions: industrial metals are firm, but real yields are rising.
• $65.17 is the level that decides whether the August uptrend survives the next pullback.

Fundamental Analysis: Silver

The monetary leg has turned less friendly. Minutes from the July FOMC meeting, published on 19 August, showed officials prepared to tighten further if inflation does not cool, after a 9-3 hold that left the target range at 3.50-3.75%. With July CPI at 3.4% and core at 2.5%, the case for cuts has thinned considerably, and a metal that pays no yield competes badly against rates that stay high.

The industrial leg is doing the opposite. The wider base and precious complex remains tight: copper is trading around $6.46 a pound, still some 45% higher than a year ago, with China's refined output set to fall for a second straight month on concentrate shortages and Chile guiding to a 2.6% production decline this year. Platinum, silver's closest structural cousin, is heading for a fourth consecutive annual deficit.

The resolution is that silver is being valued as a scarce industrial input first and a monetary hedge second. That is why it held up through a hawkish week rather than breaking with the rate story - and it is also why any real crack in Chinese industrial demand would hurt far more here than a hawkish Fed does.

Technical Analysis: Silver

The advance ran from roughly $57 at the start of August to a peak near $67.60 on 11 August, then spent a week consolidating between $65 and $67. The pullback on 17-18 August was the sharpest of the trend, reaching $63.30 and undercutting the fast averages, but it was bought aggressively - the last two sessions have carried price back to $67.31 intraday and $66.8855 now.

Resistance is the $67.31 recovery high, then the $67.60 August peak. Support is the $65.1694 fast average, then $64.4194, with the $63.0576 average marking the level that just held. A four-hour close under $63.05 would break the sequence of higher lows and turn the August advance into a completed move.

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