Key Points
- US Non-Farm Payrolls missed the mark badly, coming in at a meager 12,000.
- The XAG/USD has a key technical level present at 32.500.
- The US Election and November Fed Announcements will be next week’s primary silver market drivers.
Market Overview
2024 has been a silver (XAG/USD) bull market for the ages. Prices are up 37% since 1 January and are positioned to move higher. Can anything derail silver’s strength? Let’s look deeper at the day’s key XAG/USD fundamentals and technicals.
A Bad Miss For NFP
The first trading day of November brought a blockbuster US Non-Farm Payrolls report. NFP came in at 12,000 for October, underperforming the 104,000 projected. Unemployment held firm at 4.1%. Simply put, this was an epic downside miss.
But that wasn’t the whole story. The August and September NFP numbers were each revised. August saw an 81,000-job decrease, and September’s number fell by 31,000. These downward revisions followed upward revisions in the October report.
The financial media is reporting that Hurricanes Helene and Milton are to blame for the revisions to NFP. However, the Bureau of Labor Statistics questions this assertion in their official Employment Situation Summary:
“No changes were made to either the establishment or household survey estimation procedures for the October data. It is likely that payroll employment estimates in some industries were affected by the hurricanes; however, it is not possible to quantify the net effect on the over-the-month change in national employment, hours, or earnings estimates because the establishment survey is not designed to isolate effects from extreme weather events.”
It can be challenging to unpack NFP reports, especially this one. Here’s what we know: job creation was way down, unemployment held firm, and it remains to be seen if the hurricanes drove the shortfall.
Bottom line: Friday’s NFP was a dreadful figure. The report boosted the likelihood of more aggressive Fed rate cuts to boost employment.
XAG/USD: Technical Outlook
The trend is bullish for the XAG/USD. A long side bias is warranted, and the psychological barrier of 35.000 has served as a short-term top. This is the key level to watch; if 35.000 fails as resistance, this market is moving significantly higher.
Even though the trend in the XAG/USD is clear-cut, buying into this market can be tricky. In the coming sessions, the Weekly 50% Fibonacci Retracement and Weekly Trendline will intersect in the vicinity of 32.500. This will be a critical support zone and buying opportunity. As long as silver holds above 32.500, a long position is prudent. Should this area fail as downside support, a swift selloff to 31.936 is highly likely.
Next Week
The week from 4-8 November will be a hyperactive time on the markets. The markets will price the US election and Fed Announcements during this period. Also, the Bank of England and Reserve Bank of Australia are due out with their latest policy decisions.
It’s a great time to be in the markets. Manage your risk, stay aware of the news cycle, and profit. Volatility will be the rule as we dive into November’s trade. Stack the green pips high, and we’ll see you in the HTT trading room!
Risk Disclosure: The information provided in this article is not intended to give financial advice, recommend investments, guarantee profits, or shield you from losses. Our content is only for informational purposes and to help you understand the risks and complexity of these markets by providing objective analysis. Before trading, carefully consider your experience, financial goals, and risk tolerance. Trading involves significant potential for financial loss and isn't suitable for everyone.
