IGI Securities Limited – Commodity News

Karachi, January 15, 2019 (PPI-OT): Silver

Technical

Silver markets have pulled back slightly over the last several days, as it got close to the psychologically and structurally important $16.00 level. It has seen an explosion to the upside, so it makes sense that it pull back a little bit to perhaps build up enough momentum to continue rising in value. The $15 level underneath will now be the “floor”, but it also recognize that the $15.50 level should offer a bit of support also. The market will eventually try to go above the $16 level above, but it also recognize that the break out will take a lot of momentum. That’s what this pullback is all about, so that short-term pullbacks can offer opportunities to buy little bits and pieces of silver, as this market does tend to be rather erratic and choppy at times. If it break down below the $15.00 level, it can give up on the bullish pressure, a lease for the meantime.

Highlights

Silver prices marked up 0.1 percent to $15.63 per Ounce

The white metal currently trades at $15.68 per ounce, down 0.4% on the week

A recession, or even a significant economic slowdown, would drive the pace of debt growth well in excess of 5%

Exploding U.S debt and a prolonged equity bear market will significantly weaken the U.S dollar

March Comex silver was down $0.026 at $15.63 an ounce

Fundamentals

Silver futures tilted higher in Asian trade as the dollar index lost ground ahead of US inflation and industrial data later today, and ahead of the crucial UK Brexit vote in Parliament.

Silver futures due in March rose 0.12% to $15.71 an ounce, while the dollar index slipped 0.06% to 95.55. Now investors await US producer prices data, expected to show a 0.1% slip in December, compared to a 0.1% increase in November, while estimated with a 2.5% yearly increase.

Core prices are expected with a 0.2% increase, compared to a 0.3% increase in November, while the Empire State Manufacturing Index is expected at 11.6, up from 10.9 in December.

Federal Reserve Bank of Kansas City President Esther George is scheduled to speak about the economic outlook and monetary policy later today, while a US government shutdown entered its fourth week, making it the longest such shutdown in US history.

The U.S government partial shutdown is now the longest on record. The matter is not a serious drag on the marketplace, but many markets are lacking normal economic reports to drive their daily price action, which is causing uncertainty and some anxiety amid the dearth of news, which is generally bearish for those impacted markets.

Metals markets don’t appear to be getting much of a boost due to investor fears over the government shutdown. So far, the standoff between Trump and Democrat leaders has been perceived by investors as more of a sideshow than a genuine threat to the economy.

Leave a Reply