David Becker
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Silver prices tumbled on Thursday, breaking through support levels and poised to test lower levels. The dollar rallied following the Fed’s more hawkish than expected commentary on Wednesday, as 7-Fed governors now expect the Fed to raise rates in 2022. Jobless claims rose more than expected, which helped the 10-year yield ease following Wednesday’s rally. According to Mortgage News Daily, the average rate on the popular 30-year fixed mortgage moved decidedly higher, hitting 3.25%.

Technical Analysis

Silver prices tumbled on Thursday, breaking down and forming a topping pattern. Support is seen near an upwards sloping trend line that comes in near $25.07. Resistance is seen near the 50-day moving average at 27.01. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is flat as the MACD (moving average convergence divergence) histogram is printing in positive territory with a sliding trajectory that points to consolidation. After consolidating for weeks, prices have declined for 4-consecutive trading days but will like seeing buyers come near trend line support.

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Yields Ease on Weak Claims Report

Initial jobless claims came in higher than expected, showing that the recovery in employment is not a straight line. First-time filings for unemployment insurance for the week ended June 12 totaled 412,000, compared with the previous week’s 375,000. Expectations were for a decline to 360,000. Since the Fed makes its decisions based on employment and price stability they are likely to let inflation run a bit hotter than expected to help buoy employment.

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