Silver Finally Escapes Its Narrow Range
- Silver prices breached their $15.08 to $15.56 range following Friday’s better than expected U.S. data reports. The trend is now short-term bearish below the March 31 swing high of $15.56.
- The potentially most attention grabbing macro reports on deck today are the US Factory Order followed by the final Durable Goods Order.
The price of silver (FXCM: XAG/USD) may have ended the stalemate seen over the last few days as prices slid by 66 cents on the back of both Friday’s labor market report and the ISM Manufacturing Index result. Prices are now trading below the $15.08 support level which was keeping silver within a narrow range.
The decline to silver occurred as the U.S. Dollar gained on the economy adding 215K new jobs versus the +205K expected. Wages gained by 2.3% YoY from 2.2% in February and the latter is important for the Fed at the current stage of the economy cycle as it is said to be considering potential rate hikes later this year if wage growth continues to grow.
Another boost to the USD and therefore bearish for the price of silver was the U.S. ISM Manufacturing rise to 51.8 from 49.5, an occurrence which beat expectations of seeing 50.7.
This gain above the 50 threshold is the first time since August 2015 that such has been witnessed and implies that the manufacturing sector is in an expansionary phase.
The Technical Trend Is Short-term Bearish
The March 31 swing high of $15.56 is a lower high in relation to the March 22 high of $16.03 and this leaves the short-term bearish level below the March 31 swing high of $15.56. The next level of support is last week’s low of $14.81 followed by March 1 low of $14.75 and February 29 low of $14.64.
The potentially most attention grabbing macro reports on deck today are the US Factory Order followed by the final Durable Goods Order. For consensus projected outcomes for these reports please see our economic calendar.
Silver Price | FXCM: XAG/USD
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.