Anticipated U.S. monetary policy changes, including a potential rate cut, could introduce volatility and possibly support silver, given its historical relationship with rate movements.
Key Points
- Silver dropped 2.82% on Friday due to weak Chinese manufacturing data.
- Today, silver is down another 0.56%, pressured by ongoing economic concerns in China.
- Tomorrow’s U.S. ISM Manufacturing PMI could influence silver prices, with strong data potentially supporting prices.
Silver Daily Price Analysis – 02/09/2024
On Friday, silver prices experienced a significant decline, closing at $29.145 after opening at $29.830, which marked a decrease of 2.82%. The drop was primarily influenced by the disappointing economic data from China, particularly the decline in the Manufacturing PMI to 49.1 in August, indicating a contraction in the manufacturing sector. As China is a major consumer of silver, this contraction has created downward pressure on silver prices, reflecting concerns over reduced industrial demand.
Today, silver continues to struggle, opening at $29.245 and currently trading at $28.980, down 0.56% so far. The ongoing concerns surrounding China’s economic performance, combined with a cautious market sentiment, have kept silver under pressure. The market is reacting to the broader global economic uncertainty, which has led to an intraday low of $28.33, further indicating the vulnerability in the silver market.
Key Economic Data and News to Be Released Today
While the U.S. ISM Manufacturing PMI is scheduled for release tomorrow, it is still a significant event to monitor for its potential impact on silver prices. A stronger-than-expected reading could ease concerns about global industrial demand, potentially providing some support to silver prices. Conversely, if the data is weaker than anticipated, it could exacerbate the current bearish trend, pushing prices lower.
Additionally, any developments related to monetary policies, particularly the anticipated U.S. rate cut, could inject volatility into the market. Historically, rate cuts tend to be supportive of precious metals, as they lower the opportunity cost of holding non-yielding assets like silver. Furthermore, the potential increase in demand from Samsung’s silver-based batteries remains a key factor to watch, as it could provide a bullish catalyst for silver in the medium to long term.
Silver Technical Analysis – 02/09/2024
Looking at the Silver chart from a technical analysis perspective. It is clear that the asset is currently in a bearish trend as price is currently significantly below the 200 EMA.
While the RSI indicator is currently not overbought, we may see price pull back towards the 200 EMA or pivot point before price continues its downward trend.
Silver Fibonacci Key Price Levels 02/09/2024
Short-term traders planning to trade XAG/USD today should keep a close eye on the following key price levels for the day:
| Support | Resistance |
| 29.055 | 29.755 |
| 28.840 | 29.970 |
| 28.490 | 30.320 |
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.
