Silver Prices: Slammed on NFPs, Bottom-end of Range Coming into View
- Silver prices takes a hit on NFPs
- Looking for continued weakness towards 19.20 level
- Short-term support and resistance levels outlined
Silver prices were already precariously postured heading into Friday’s US jobs report, as a potentially bearish chart configuration at the top-end of the month+ long range had already triggered, undercutting short-term trend support not long after. In addition, the record number of speculative longs continuing to mount while silver went nowhere in recent weeks suggested silver was more bear than bull.
The non-farm payrolls data was much better than expected for a second month in a row; 255k vs. 180k expected. The announcement sent the dollar sharply higher, while pressuring precious metals – both gold and silver finished the day closing near their worst levels of the session and week.
This price action has silver approaching the bottom-end of the range near 19.20 (Overnight low was 19.47). We expect more weakness before possibly bouncing higher in an effort to continue building the range which began in early July.
Short-term levels to focus on: Resistance comes in at between 19.93 and 20.03. In the short-run, silver is unlikely to overcome both levels with conviction if a move is to continue to the 19.20 level, making it a key area for shorts to look for strength to turn back into weakness. In the event silver sinks to 19.20, we will shift towards a neutral view given its level of support before, and should it respond vigorously off this level, then it may warrant a long positon for a bounce.
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.