Silver Breaks Out of Two Month Channel, Targets $68

Silver prices jumped over four percent on Tuesday, trading near $59 and breaking out of a descending channel that has capped the metal since May. The rally pushed the asset away from an eight month low near $55, driven by renewed hopes for US Iran diplomacy. This diplomatic progress helped cool oil prices, which had recently surged and stoked inflation fears across global markets.

Inflation concerns had previously weighed on silver because rising prices increase the likelihood of higher interest rates. Since silver does not pay a yield, higher rates typically hurt its appeal. However, the metal found strong technical support near the $55 mark, forming a double bottom pattern alongside a bullish divergence on the Relative Strength Index. These momentum signals often point to fading sell pressure and a potential trend reversal.

Traders are now eyeing the $68 Fibonacci retracement level as the next major upside target, which represents a potential sixteen percent gain from current prices. The broader fundamental picture also remains supportive, with analysts projecting another annual supply deficit in 2026 alongside rising physical investment demand. To keep the bullish momentum alive, bulls need the current breakout to hold, while a drop back below $55 could expose longer term support near $50.