Silver prices create a solid foundation around 70 USD/ounce

Mr. Nate Miller - Vice President of Product Development at Amplify ETFs - said silver is entering an accumulation phase after a strong year-on-year rally. However, long-term prospects remain positive thanks to industrial demand and macroeconomic factors continuing to support the market.

According to Mr. Miller, although silver in the 60 - 70 USD/ounce range may be less active when it reaches 120 USD/ounce, this metal still plays an important role and will continue to be a noteworthy asset.

He believes that the fact that silver prices maintain their current highs is a signal that the market structure has changed, after many decades mainly fluctuating around 25 - 30 USD/ounce. Although not breaking through strongly, maintaining a high price level is still a positive signal for both investors and mining businesses.

The manager of Amplify ETFs described the current sideways trend as a "healthy correction" phase. He remains optimistic that silver prices could continue to rise if cash flow returns to the precious metal group or industrial demand continues to improve.

However, according to him, for silver to return to very high levels such as 100 - 120 USD/ounce, the decisive factor is likely to still be inflation. If inflation remains high, the demand to hold precious metals to preserve asset value may increase again, thereby supporting both silver and gold.

Mr. Miller also noted that gold is more closely associated with the role of monetary asset, while silver is both sheltering and affected by industrial demand. Therefore, if inflationary pressure is only temporary, the room for silver to increase may be more modest, mainly based on production demand, with a potential price range of about 70 - 80 USD/ounce.

In addition, silver is also considered a tool to diversify investment portfolios thanks to its ability to generate low returns relative to traditional stocks and bonds. In the context of price accumulation, this may be a suitable time for investors to gradually restructure their positions.

For the mining industry, a high but stable silver price level is also of great significance. According to Mr. Miller, ineffective projects when silver was at 25 USD/ounce can now be feasible in the 70 USD/ounce zone. Price stability is an important factor for businesses to build long-term plans, and at the same time can attract more investment capital into this field.

From an investment perspective, he continued to assess silver industry stocks, especially small-scale mining companies, as a group with potential but strong volatility. Due to their high sensitivity to silver prices, this group may bring large profits in the rising market, but investors still need to manage their portfolios tightly and rebalance to avoid excessive concentration of risks.

Although the unstable economic environment partly supports silver prices, Mr. Miller believes that the market still faces some challenges, including increased input costs, especially energy.

High oil prices may put pressure on the profit margin of mining enterprises, but this impact is assessed to be mainly short-term. Many mining companies now also have better financial foundations than previous cycles, thanks to taking advantage of high price periods to consolidate balance sheets instead of excessively expanding risks.