Silver Price Prediction – Prices Fail to Break Higher

Silver prices slid on Tuesday and were unable to take out resistance near a downward sloping trend line.  Gold prices continue but failed to buoy silver prices. U.S. yields moved lower, which capped the dollar but failed to help silver gain traction. U.S. PPI was mixed, as core PPI rose less than expected.

Technical analysis

Silver prices rallied but were unable to take out short-term support near and upward slopiong trend line that comes in near 24.45. Additional support is seen near the 10-day moving average at 23.97. Short-term momentum has turned negative as the fast stochastic generates a crossover sell signal. Medium-term momentum has also turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD line). The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.

 Wholesale Inflation Rises to Decade Level Highs

Core inflation surged to on a year-over-year basis, increasing by 6.2%. The year-over-year records go back to November 2010. The Labor Department reported that producer prices rose 0.6% for the month, in line with expectations. The monthly pace was faster than the 0.5% increase in September. Excluding food and energy the PPI increased 0.4% month over month, slightly below the 0.5% estimate but an elevated pace from September’s 0.1% gain.