- Nonfarm payrolls were better than analysts expected, despite coming under fire from the White House.
- Silver edged up 0.18%, following in the footsteps of the US Dollar.
- XAG/USD’s inability to regain an uptrend line is putting downward pressure on the white metal.
Silver (XAG/USD) pares Thursday’s losses as the North American session gains momentum. At the time of writing, XAG/USD is trading at $22.43, up 0.18%. Market sentiment is mixed, with European stocks trading in the red while US equity indices are in the green after US employment.
In the meantime, the yield on 10-year US Treasury bonds, which is negatively correlated with silver, rose ten basis points, to 1.932%, supporting the greenback. The U.S. dollar index, a measure of the value of the dollar against a basket of six rivals, edged up 0.18% to stand above 95.59.
Non-farm payrolls topped 450,000, beating expectations
Before the opening of Wall Street, nonfarm payrolls in the United States for January were 467,000 higher than the 150,000, as revealed on Friday by the Bureau of Labor Statistics (BLS). During the week, White House economic advisers and Philadelphia Fed Chairman Harker talked about the January jobs report, which was expected to be worse than estimates, due to the impact of the
Dissecting the NFP report, the average hourly wage rose 5.7%, putting additional pressure on the Fed as higher wages equate to high inflation. In addition, the unemployment rate hit 4.0%, a tenth higher than the estimated 3.9%.
XAG/USD Price Prediction: Technical Outlook
In Friday night session for North American traders, XAG/USD hovered around the $22.40-$64, $0.24 range. However, volatility accelerated once US traders arrived at their desks and the US jobs report was released. XAG/USD’s knee-jerk reaction sent silver to the February 3rd daily low around $22.00, followed by a jump towards $22.50, towards the end of Thursday.
That said, XAG/USD is biased lower. Failure to recover above a previous support-turned-resistance ascending trendline puts downward pressure on the metal that does not yield. The first support for XAG/USD would be the daily low from January 28 at $22.18. A break of this would expose the January 7th low at $21.94, followed by the December 15th cycle low at $21.42.