Silver Prices Rebound from Session Lows as Yields Ease

Silver prices bounced from session lows, and traded in a tight weekly range. The 10-year yield eased slightly after rallying sharply on Thursday, following the higher inflation levels seen in 40-years. Gold prices rose as the US dollar softened. According to a recent report from the University of Michigan, the sentiment was softer than expected, and future expectations are glim.

Technical Analysis

On Friday, silver prices edged higher. Support is now the former resistance level seen near the 50-day moving average at 22.86. Resistance is seen near the 200-day moving average at 24.38. Short-term momentum is positive as the fast stochastic generated a crossover buy signal. Medium-term momentum turns positive as MACD (moving average convergence divergence) index moves toward a crossover buy signal. This scenario occurs when the MACD line (the 12-day moving average minus the 26-day moving average) crosses over the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram prints in negative territory with an upward sloping trajectory. Negative momentum is decelerating, which points toward higher prices.

Future Expectations Slide Hitting a 10-year Low

Consumers’ sentiment was dismal in the first week of February. The University of Michigan consumer sentiment index declined 5.5 points to 61.7. This figure is the lowest print since 60.8 in October 2011. Expectations were for consumer sentiment to come in slightly below the December print at 67. The future expectations component of the consumer sentiment survey dropped to 57.4, which is also the lowest point in more than a decade.