- Silver price rises swiftly to near $23.20 as US core PCE remains softer-than-anticipated.
- US monthly core PCE inflation grew at a nominal pace of 0.1% while the annual data softened to 3.9%.
- Silver price rebounds strongly from the neckline of the H&S chart pattern to near the 20-DEMA.
Silver price rallies $23.20 as the United States Bureau of Economic Analysis reports a soft core Personal Consumption Expenditure (PCE) price index. The monthly Core PCE grew at a nominal pace of 0.1%, slower than expectations and the former pace of 0.2%. The annual core PCE data decelerated to 3.9% as expected against July's reading of 4.3%.
The headline PCE expanded at a higher pace of 0.4% vs. July's reading of 0.2% but slower than expectations of 0.5%. On an annualized basis, the economic data accelerated nominally to 3.5% as expected due to rising energy prices.
The US Dollar Index (DXY) corrects to near 105.80 but the broader bias remains bullish as the US economy has remained resilient. The US economy is performing well on the grounds of inflation, labor market, and consumer spending but factory activity is still a concern for the authorities amid a poor demand outlook.
This week, the Durable Goods Orders data for August unexpectedly rose by 0.2% while investors forecasted a contraction of 0.5%. This indicates that business spending on equipment increases, as investors see the Federal Reserve (Fed) is done with hiking interest rates and the factory outlook, is improving. For more guidance on the current status of the manufacturing sector, investors will focus on the ISM Manufacturing PMI report for September, which will be released on Monday at 14:00 GMT.
Silver technical analysis
Silver price rebounds strongly from the neckline of the Head and Shoulder chart pattern, which is plotted from June 23 low at $22.11. The asset forms an H&S chart pattern on a daily scale, which indicates a prolonged consolidation whose breakdown triggers a bearish reversal. The white metal trades below the 20-day Exponential Moving Average (EMA) at $23.15, which indicates that the short-term trend is bearish.
The Relative Strength Index (RSI) (14) slips below 40.00, indicating no signs of divergence and oversold, warranting more downside.
Silver daily chart
-638315890256425471.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD hovers above 1.0850 amid dour mood
EUR/USD is oscillating in a tight range above 1.0850 in early Europe on Tuesday. The pair stays cautious due to risk-off sentiment and a modest US Dollar uptick, as investors weigh the ECB and Fed rate cut expectations. The focus now remains on speeches from Fed officials.
GBP/USD extends its upside above 1.2700, investors await fresh catalysts
GBP/USD extends the rally near 1.2710 on Tuesday. Investors await fresh catalysts, with different Federal Reserve speakers set to speak later in the day. On Wednesday, the UK Consumer Price Index inflation data and FOMC Minutes will be closely watched.
Gold needs to defend the 2,400 level, as more Fedspeak looms
Gold price extends pullback from the lifetime high of $2,450 set on Monday, as the US Dollar draws haven demand amid broad risk aversion. Attention again turns toward upcoming speeches from the Federal Reserve policymakers that dominate early this week, in the absence of top-tier US economic events.
New York Attorney General reaches $2 billion settlement with Genesis after claims of fraud
After a lawsuit filed by the New York Attorney General against crypto lender Genesis in late 2023, the company reached a settlement of $2 billion with the AG on Monday.
The market-moving data this week comes from everywhere other than the US
The market-moving data this week comes from everywhere other than the US. We get inflation from the UK, Canada, and Japan, possibly shifting central bank outlooks. The Fed releases FOMC minutes on Wednesday. And we get a slew of PMI’s on Thursday.