Silver Price Prediction – Prices Rise but Remain Capped

Silver prices moved higher on Thursday but remain in a tight range and continue forming a bear flag continuation pattern. Copper prices declined which could generate headwinds. A dip in jobless claims was offset by a smaller than expected rise in Durable goods orders which helped capped the movement in the greenback.

Technical Analysis

Silver prices moved higher but continue to trade in a range forming a bear flag pattern. This type of pattern is a pause that refreshes lower. Support near an upward sloping trend line that comes in near 25.17. Resistance is seen near the 100-day moving average at 26.58. The 10-day moving average is poised to cross below the 100-day moving average which means that a short-term downward trend is in place. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. The fast stochastic is also printing a reading of 21, up from 10 which reflects accelerating positive momentum. Medium-term momentum is negative as the MACD (moving average convergence divergence) histogram is printing in the red but the trajectory is positive which points to consolidation.

Claims Fall but Revisions offset Benefits

The Labor Department reported that Initial jobless claims fell by 7,000 to 411,000 in the week ended June 19.A revision offset the decline as new claims from two weeks ago were revised to 418,000 from 412,000. Expectations were for claims to fall to 380,000. The Fed is carefully watching the claims data. The last time the Fed “tapered” was in May of 2013. At the time claims had declined from their financial crisis highs to 340K. This might be a guide to when the Fed will comfortable tapering again.