Silver Price Prediction – Prices Drop on Weak Services Sector Report
Silver prices moved lower on Monday as the ISM services report put some doubt on future growth. The dollar rose again, putting additional weight on silver prices. Copper prices initially started higher but ended the session in the red, weighing on silver prices. The U.S. 10-year yield tumbled on Monday, dropping 7-basis points. Despite the decline in U.S. the yields in Europe accelerated at a quicker pace.
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Technical analysis
Silver prices moved lower as growth prospects dimmed. Prices remain above short-term support, which is seen near the 10-day moving average at 26.10. Resistance is seen near the 50-day moving average at 27.06. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term negative momentum has decelerated, and the MACD (moving average convergence divergence) index is poised to generate a crossover buy signal. The MACD histogram is printing in negative territory with a rising trajectory which points to consolidation.
Non-Manufacturing Data Slows
The U.S. ISM non-Manufacturing Index fell in June to 60.1, missing expectations that it would decline to 63.5 and down from 64.0 in May. Business production dropped -5.8 to 60.4. New orders, which is a gauge of future activity, dropped -1.8 to 62.1. Employment fell -6.0 to 49.3, back in contraction. This means that services providers believe that the “delta variant” could reduce future hiring.
