- Silver prices are higher on safe haven flows.
- Today, Markit U.S. Services PMI is on deck and may boost risk-appetite if the outcome is higher than expected. However, with stock in a firm downward trend, I doubt that the PMI will be enough.
When prices on Monday slid below the February 16 low of $15.14, the trend turned bearish. This breach to the low also triggered a ‘Head and Shoulders’ pattern, which projects a decline to $14.35. However, this outlook is not particularly strong any longer, given that the DAX 30 and FTSE 100 turned bearish this morning. This is currently lifting silver on safe haven flows.
The Trend Remains Bearish
The trend remains bearish below the February 19 high of $15.50 and price may still drift lower over the new few weeks. However, at the time of writing, it would appear that price needs to break yesterday’s low of $15.18 for the bearish momentum to pick up.
On a successful break to the February 19 high of $15.50, the trend will turn neutral-to-bullish and may potentially lift price to the February 12 high of $15.83. Gold prices are already trying to break resistance levels, and providing a hint at the same time that such may also happen to silver.
Markit U.S. Services PMI
Today, Markit U.S. Services PMI is on deck and may boost risk-appetite if the outcome is higher than expected. A Bloomberg News poll projects a rise from 53.2 to 53.5. However, with the European stock markets in a clear short-term downward trend, I doubt a good reading of the Markit U.S. Services PMI will alone be enough to stop the safe haven flows to silver.
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Silver Prices | FXCM: XAG/USD
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
— Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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