Current trend

During yesterday trading the pair XAG/USD fell to 16.16 per troy ounce. The decline in the price of silver started on Wednesday amid positive comments of two members of the US fed system regarding the recovery of the US economy.

The prices of the precious metals are under pressure due to expectation of the release of NFPR today. Investors are waiting for these data as it can be used as guidance for assessment of the state of the economy in the country, which in its turn, can help to determine timing of the increase in the interest rate by the US Fed. Analysts expect that the number of new jobs will double in comparison with the previous reporting period, from 126 thousand to 224.

Yesterday’s statistics on the initial applications for unemployment benefits indirectly confirm positive experts’ assessment.  According to the forecast the number of applications for unemployment benefits should have increased from 262 to 280 thousand. However, the index remained at the previous level.

If employment data satisfies investors’ expectations, the USD will grow, while silver will decline.

Support and resistance

Resistance levels: 16.47 (highs of the morning session), 16.75 (highs of 4 May, upper line of Bollinger bands), 17.00 (important psychological level), 17.40 (highs of 26 March).

Support levels: 16.25 (lows of the Asian session, middle line of Bollinger bands), 16.89 (lows of 1 May), 15.59 (lows of 11 March).

Trading tips

Buy the pair after breakdown of the level of 17.00 with the first target of 17.20 and the next one at 17.40. Sell positions are advisable from the level of 16.80 with the targets of 16.60 and 16.20. 

XAG/USD: analysis and forecast

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