Silver is on the move, as the metal has jumped 3.5% this week. Investors remain jittery over coronavirus and Apple's warning that it will miss its revenue forecast has boosted the metal.
Silver is up for a fifth straight day and has touched a daily high of $18.39, its highest level since January 7. Silver prices stormed past the symbolic $18.00 level on Tuesday, for the first time since February 3. It was a similar story for gold, which crossed above the psychologically important $1600 level on Tuesday, the first time that has occurred since January 8.
Investor risk aversion has climbed this week, following Apple’s warning letter to the markets that its Q1 sales will be lower than the initial forecast. Apple said that the coronavirus had hampered the delivery of iPhones from its factories in China. The company tried to put a brave face on the announcement, saying that “this disruption to our business is only temporary” and that outside of China, demand for the company’s products remains strong.
However, investors are painfully aware that the havoc caused to Apple’s supply chains is also being felt by other multinationals located in China, including the major automotive companies. With some 60 million Chinese under quarantine, it’s clear that the massive closures of factories and shops will have a chilling effect on goods produced in China, which should be bullish for silver prices.
Silver has managed to put some distance between itself and the 18.00 level, which is providing immediate support. Below, the 50-day EMA is currently situated at 17.72, followed by support at 17.50. On the upside, we find resistance lines at 18.60 and 19.20.
Kenny is an experienced market analyst, with a focus on fundamental analysis. Kenny has over 15 years of experience across a broad range of markets and assets –forex, indices and commodities.
