Silver Prices Consolidate Below 200-day Moving Average

Silver prices hovered near this week’s highs on Friday as benchmark yields fell. Silver prices finished the week up a robust 5.7%. The 10-year yield pulled back to 1.75%, dropping 7 basis points. The 2-year yield curve also dropped 5 basis points retreating to 1%. As benchmark yields fell, gold tested a two-month high of 1847 and then pulled back to 1833. The US dollar pulled back slightly but was not enough to buoy silver prices.

Technical Analysis

On Friday,  silver prices consolidated near the 200-day moving average. Long-term resistance is seen near the 200-day moving average at 24.63. Short-term momentum turned negative. The fast stochastic 14-day range crossed over the 3-day simple moving average to reverse the trend. Prices are still overbought. The fast stochastic is printing a reading of 100, above the overbought trigger level of 80. Medium-term momentum remains positive as the MACD (moving average convergence divergence) index crossover buy signal continues to move higher. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line).

Leading Economic Indicators Rise

The conference board reported that leading economic indicators, which is a forward-looking gauge, rose 0.8% in December. The organization’s Leading Economic Index now stands at 120.8, following a 0.7% increase in November. The December results were in line with expectations and showed that growth continues to climb.