Silver Price Forecast: XAG/USD shoots above $23 on subdued job data, Services PMI

Silver price (XAG/USD) climbs swiftly to near $23.30 as the United States Bureau of Labor Statistics (BLS) has reported that the pace of hiring by firms was slow in October. The white metal rallies as investors hope that a softer-than-anticipated labor market report will allow Federal Reserve (Fed) policymakers to keep interest rates unchanged in the range of 5.25-5.50% till the end of 2023.

As per the US NFP report, the workforce witnessed fresh additions of 150K vs. expectations of 180K and September’s reading of 297K (revised lower). The Unemployment Rate rose to 3.9% against expectations of 3.8%. The wage growth also slowed to 0.2% against a 0.3% gain in September.

The market mood turns upbeat as slower growth in the job market may bring down consumer spending and ease consumer inflation. Meanwhile, the S&P500 has opened on a bullish note as investors hope that the Fed is done with hiking interest rates. The US Dollar Index (DXY) refreshed its six-week low below 105.20. 10-year US Treasury yields have plunged further to 4.53%.

The Institute of Supply Management (ISM) has reported that the Services PMI for September dropped sharply to 51.8 against expectations of 53.0 and the former reading of 53.6.

Silver technical analysis

Silver price forms a Bullish Flag chart pattern on a four-hour scale. The aforementioned chart pattern indicates a transfer of inventory from retail participants to institutional investors. The white metal remains cushioned by the 200-period Exponential Moving Average (EMA) at $22.80. The horizontal resistance is plotted from September 22 high at $23.77.

The Relative Strength Index (RSI) (14) aims to shift into the bullish range of 60.00-80.00. A bullish momentum will trigger if the RSI (14) would manage to do so.

Silver four-hour chart