After strong gains during Christmas week, silver is again knocking on the 18.00 level. Will the metal manage to cross this key level before the end of 2019?
Silver has started the new trading week with small gains. Currently, silver is trading at $17.80, up $0.05 or 0.30% on the day.
Silver prices moved considerably higher during Christmas week, posting gains of 3.4 percent and testing the symbolic 18.00 level. This marked silver’s best week since late August.
Equity markets and precious metals are enjoying late-year rallies. Silver and gold, which are safe-haven assets metals, often weaken when risk appetite is high, but this was not the case last week. Investor confidence is high, as geopolitical hot spots such as the Persian Gulf have been calm lately and the U.S. economy remains strong. This has sent the equity markets higher, but at the same time, investors have not abandoned gold and silver. It appears that the odd-man-out from the end of the year party is the U.S. dollar, which was broadly lower last week.
Investors are expecting stronger U.S. numbers in the final week of the year. Later on Monday, Chicago PMI, an important business barometer, is expected to improve to 48.2 in December, compared to 46.3 in November. On Tuesday, CB Consumer Confidence is projected to accelerate to 128.0 in December, compared to 125.5 in November. The manufacturing PMI is also expected to accelerate, with an estimate of 49.0 December, up from 48.1 pts in November.
After a strong gain last week, silver is again pressing on the 18.00 level, which has psychological significance. If the metal continues to rally and crosses above this line, there is room for silver to move upwards, with no resistance until 18.60. On the downside, we find support at 17.25, followed closely by the 50-EMA line at 17.22.
Kenny is an experienced market analyst, with a focus on fundamental analysis. Kenny has over 15 years of experience across a broad range of markets and assets –forex, indices and commodities.
