Silver Price Prediction – Prices are sliding ahead of US inflation data

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Silver prices fell after Monday’s flash crash that saw prices drop nearly $ 1 an ounce. The dollar rose higher and the euro fell after a weaker-than-expected German Zew poll. The yield differential moved in favor of the greenback as US yields continue to climb ahead of this week’s inflation data. Later in the week, investors need to evaluate the CPI, PPI, and import prices.

Technical analysis

Silver prices have fallen and remain under pressure after Monday’s flash crash. Target support is seen near the November 2020 lows of 21.87. Resistance is seen near the former support at the March low at 24.41. The short term momentum has turned negative as the fast stochastic crossover sell signal was generated. Medium-term momentum turned negative as the Moving Average Convergence Divergenence (MACD) generated a crossover sell signal. This happens when the MACD line (the 12-day moving average minus the 26-day moving average) falls below the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram prints in the negative area with a downward sloping path, indicating lower prices.

Inflation data expected for this week

A flood of US inflation data is due to be released on Wednesday, Thursday and Friday. Consumer prices, producer prices, and import prices should show that inflation remains high in the United States. Last week the Department of Labor reported that US wage inflation was up 4% year over year. More than expected inflation data is likely to put upward pressure on US yields and boost the dollar. Since silver is valued in US dollars, a stronger dollar will weigh on silver.

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