Silver Prices Turn Sluggish Ahead of U.S. Employment Data
- Silver prices are trading sideways ahead of today’s NFP report.
- Traders will watch the outcome of the labor market report and the $17.15 to $17.62 range to anticipate the next move for silver prices.
When a range has trapped price, the price may experience further consolidation until a break occurs and a potential trend emerges.
A break to the range could be helped by macroeconomic reports like today’s U.S. labor market report. We note that ahead of the publication, the general tendency of price is to trade sluggishly as traders hesitate to enter the market before such an important macroeconomic event.
The upper end of the above-mentioned range is yesterday’s high of $17.62 and above this level the next resistance level are the May 3 high of $17.70, followed by the May 2 high of $18.00.
The lower end of the range is the May 4 low of $17.15. Below it, the April 27 low of $17.03 and April 25 low of $16.78 are acting as support levels.
The general tendency is for a higher than expected NFP outcome, lower unemployment rate and higher wage growth to force the Fed to raise rates, which may lift the Dollar and generate lower silver prices in anticipation of the Fed taking action.
The U.S. economy is expected to have added 200k new jobs and for the unemployment rate to decline to 4.9% from 5%. However, with the unemployment rate being at long-term low levels, the wage growth may steal its limelight. Wage growth has been trading higher over the last year and today may likely reach 2.4% from 2.3% per a Bloomberg News survey.
Silver Price | CFD: 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