Silver Price Prediction – Prices Explode and Set to Test September Highs

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Silver prices continued to recover, breaking through support as gold rose and the dollar fell. US yields were lower following a lower than expected PPI report. Jobless claims fell more than expected but failed to support yields and the greenback, giving silver prices the boost.

Technical analysis

Silver prices have moved higher on target resistance which is the 50 day moving average near 23.29. Target resistance is September high at 24.82. Short-term momentum is positive as the Rapid Stochastic has recently generated a cross buy signal. Prices are overbought as the Fast Stochastic shows a reading of 98, above the overbought trigger level of 80. Medium term momentum turned positive as the MACD (Moving Average Convergence Divergence) index generated a cross buy signal. This happens when the MACD line (the 12 day moving average minus the 26 day moving average) crosses above the MACD signal line (the 9 day moving average of the MACD line). The MACD histogram prints in positive territory with an upward sloping path that indicates higher prices.

Producer prices increase less than expected

The producer price index rose 0.5% in September, slightly below the expected 0.6%. However, on a 12-month basis, the index rose 8.6%, a new record for a data series that dates back to November 2010 and reflects the current inflationary climate, according to the Labor Department. Excluding food and energy, the core PPI rose only 0.1% from the forecast of 0.5%, bringing the 12-month gain to 5.9%, the highest level since March 1982.

This article originally appeared on FX Empire

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