- Silver prices drop drastically on the news of the US/Sine ceasefire.
- Silver falls to as low as $15.12 on the open, eyes turn to U.S. data this week.
Silver prices ended the U.S. session at $15.3169 on Friday, up 0.37% having travelled between a low of $15.2126 and a high of $15.3414. However, on the open today, prices have crashed following news of a US/Sino ceasefire agreed at the G20 over the weekend. Currently, silver is trading at $15.21 from $15.31 highs and dropped to as low as $15.12 on the open. Meanwhile, the Gold/Silver ratio has made a notable top in the 90s with a weekly candle rejected by supply just below 93.
While Trump and Xi agreed to continue the trade negotiations with no additional tariffs are expected in the coming months, the uncertainty, however, will continue to keep the Federal Reserve on red alert and this will hardly boost prospects of a turnaround in global growth prospects, not until the many obstacles that stand in the way of a permanent end to the trade spat is obvious. The lukewarm result was widely expected in the markets prior to the meeting and from here out, US data will be critical for the week ahead.
US data coming up this week
Market attention will now turn to the US Nonfarm Payrolls and Manufacturing data. For manufacturing, analysts at TD Securities are looking for a new decline in the ISM index to 51.0, as they expect ongoing trade headwinds to have affected business sentiment in June. “Indeed, the average of the ISM-adjusted regional surveys are signalling further declines. In addition, a recent spate of soft growth in core durable goods orders and a weak Markit PMI also boost the odds for a downside surprise, in our view.” On nonfarm payrolls, the analysts look for them to bounce to 150k in June, following the below-expectations 75k May print. “Employment in the goods sector should remain soft, while we look for a modest rebound in the services sector. The household survey should show the unemployment rate remained steady at 3.6%, while wages are expected to rise 0.3% (3.2% y/y) on the back of a favourable reference week.”
Silver levels
The price of the precious metal is now below the key15.16 support and consolidates, advancing further below the 15.50 upside target, thus the technical outlook has now switched bearish with both the 4hr and 1hr stochastics crossing below 80. Risk is now open towards to 14.75. On the flip side, on a break of 15.50, however, the bulls will look to 15.83 as a target, a 78.06% Fibo level, ahead of 16.00.
Share
