Silver Price Prediction – Silver Prices Face Headwinds from Dollar Strength

Silver prices moved lower after rising early in the trading session and then failing. Prices remained above short-term support. Prices are still forming a bear flag continuation pattern. With the dollar continuing to break out, its hard to see silver prices gain traction as the precious metals complex will likely remain under pressure.  U.S. Treasury yields moved higher following a larger than expected decline in U.S. employment claims. The weaker than expected U.S. ISM Manufacturing report kept yields capped.

Technical analysis

Silver prices moved higher and continue to consolidate, forming a bear flag continuation pattern. Prices remain above short-term support, which is seen near the 10-day moving average at 25.94. Resistance is seen near the 50-day moving average at 27.05. The short-term trend is downward sloping as the 10-day moving average recently crossed below the 50-day moving average. Short-term momentum is positive as the fast stochastic generated a crossover buy signal. Prices are oversold as the fast stochastic is printing a reading of 19 below the oversold trigger level of 20, which could foreshadow a correction. Medium-term negative momentum has decelerated, and the MACD (moving average convergence divergence) index is poised to generate a crossover buy signal. This scenario occur 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).

Jobless Claims Rise Less than Expected

The Labor Department reported on Thursday that initial filings for unemployment insurance fell sharply last week. Initial jobless claims totaled 364,000 for the week ended June 26, compared with the 390,000 expected. The last time there were fewer claims was the week of March 14, 2020, just before the worst of the economic damage hit.