Silver Calm Ahead of U.S. Nonfarm Payrolls

Silver prices are flat on Friday. However, we could see some movement later in the day, as the U.S. releases Nonfarm payrolls and wage growth at 15:30 GMT.
Kenny Fisher

Silver is trading sideways for a second successive day. In the European session, silver is trading at $16.91, down $0.04 or 0.32% on the day.

Trade Talks Triggers Silver Volatility

Silver prices have shown some strong swings this week, with a gain of 1.5% on Tuesday, which was quickly erased the next day. These moves were the strongest we’ve seen in almost a month, and were triggered by comments from U.S. President Trump about the U.S-China trade talks. Silver jumped on Tuesday after Trump suggested that a trade agreement with China might have to wait until after the U.S. election in 2020. However, Trump kept the markets jumping, after saying on Wednesday that the discussions with China were “going very well”. Aside from Trump’s comments on Wednesday, Bloomberg reported that the two sides have made progress on the question of eliminating tariffs. With precious metals sensitive to the extent of progress of the talks, traders can expect more volatility from silver as there are further developments in the negotiations.

Will U.S. Job Data Shake Up Silver?

The U.S. releases key employment data later on Friday, which could trigger some movement in the markets. Analysts are expecting strong numbers, which could boost investor confidence and weigh on silver prices. Nonfarm payrolls are projected to increase sharply to 181 thousand, compared to 128 thousand in the previous release. As well, wage growth is expected to rise from 0.2% to 0.3%. The UoM Consumer Sentiment index is also expected to climb to 97.0, up from 95.7 pts.

Silver Technical Analysis

With silver showing little movement, 17.25 remains an immediate resistance line. Note that the 50-EMA is also at this level. Above, there is resistance at 17.75. On the downside, the 200-EMA is at 16.72, slightly support at 16.50. Below, there is support at the round number of 16.00, which has psychological significance. I monitoring the 200-EMA and 50-EMA lines, which could be headed for a crossover. If the 200-EMA does break above the 50-EMA, this would be a bearish signal for silver.

XAGUSD 1-Day Chart
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