Silver Price Prediction – Prices Consolidate as the Dollar Rallies

Silver prices edged lower and finished off the session lows. The dollar found traction and rallied sharply which weighed on silver prices. Gold prices were actually higher allowing silver to buck the precious metals trend. The rally in the greenback came as short-term U.S. Treasury yields moved higher following a stronger than expected U.S. ADP Private Payroll Report.

Technical analysis

Silver prices closed lower but well off the session lows. Resistance is seen near the 50-day moving average at 23.60. Support is seen near the 10-year moving average at 22.41. Short-term momentum is positive as the fast stochastic recently generated a crossover buy signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.

ADP Prive Payrolls Point to a Strong Employment Report

A strong private payroll report is expected to foreshadow a strong government report which will be reported on Friday. Economists expected 500,000 new jobs after August’s letdown of just 235,000. ADP reported that private jobs rose by 568,000 for the month, better than the estimate of 425,000 and ahead of the downwardly revised 340,000 reading in August. The initial August report showed growth of 374,000.