Silver Price Forecast: $63 Holds as NFP Risk Tests Bullish Channel
Silver prices are hovering near $63.00 in the early European trading session, after a sharp climb over the past few weeks that pushed...
Quick overview
- Silver prices are currently around $63.00 after a recent climb, with investors taking profits ahead of key US economic data releases.
- The upcoming jobs report is expected to show a slowdown in job growth, which could support silver prices by weakening the dollar.
- Silver's demand is largely industrial, making it more sensitive to economic changes compared to gold, which helps maintain its price stability.
- Technical indicators suggest that as long as silver remains above key support levels, it is likely to continue its upward trend.
Silver prices are hovering near $63.00 in the early European trading session, after a sharp climb over the past few weeks that pushed prices to new cycle highs. The pause is more about people taking profits than losing interest, as investors step back to consider the risks ahead of major US economic releases, including the jobs report, retail sales, and other key data points.
The jobs report is expected to show that US employers added 51K jobs last month, well below the 119K added last time. Meanwhile, the unemployment rate is expected to tick up to 4.5%. A pretty soft jobs report would make it clear that the US economy is slowing, which could weaken the dollar a bit and help keep silver prices steady, as interest rates would be lower.
One thing to keep in mind is that silver is much more sensitive to economic changes than gold. Roughly 55% of global silver demand is for industrial uses, such as manufacturing and energy transitions. That’s why the price can hold firm even when short-term momentum dips a bit.
Macro Backdrop Still Favors Metals
The markets right now have the Fed on track to be more accommodative than it is saying it will be. The futures market is signaling a good chance of at least two interest rate cuts by the end of next year, which is why Treasury yields are low, and the dollar isn’t rising much.
And then there’s this week’s US data releases
- Retail sales are expected to be down to 0.1% from 0.2% last time.
- The Flash manufacturing PMI is expected to be 52.0, but that’s a slight slowdown.
- The Servies PMI is expected to be 54.0, which is also a bit softer
All this data suggests the US economy is slowing without overheating again, which is good news for silver prices during times like these.
[[XAG/USD-graph]]
Silver Technical Structure Remains Constructive
On the 2-hour chart, silver is still within a pretty clear uptrend channel that’s been guiding prices since late November. After the price failed to hold above $64.50 it pulled back to $63.00 and it looks like it’s respecting the trend.
Some other things to keep in mind when looking at the technical picture
- It’s still above the moving average near $62.50.
- The moving average at $60.90, further back, is also holding strong.
- The recent price action shows pretty small bodies on the charts, so it’s not distributing, and the RSI is sitting right on 50-52, which is a neutral level after being overbought.
Silver Price Forecast and Trade Levels
As long as silver stays above its structure support, pullbacks are looking corrective.
- Buy zone: $62.80-$61.80
- If it breaks below $60.15 then that would be a bad sign
- If it moves upwards, the targets are $64.50, then $65.85, and $67.30.
Right now, silver is digesting some of its gains ahead of the US data, and it doesn’t seem ready to change the trend just yet. The jobs report will tell us a lot about the next move. Is it going to keep going up, or is it going to consolidate?
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