Silver prices remained in a range on Thursday, whipsawing in the wake of the hotter than expected CPI report. The 10-year yield surged higher along with the front end of the curve, following the higher inflation levels seen in 40-years. Gold prices rose for the fifth consecutive trading session as the US dollar softened. Jobless claims came in stronger than expected. Initial jobless claims came in at 223,000 for the week ended February 5. This figures was lower than the estimate of 230,000.
Technical Analysis
On Thursday, silver prices edged higher. Support is now the former resistance level seen near the 50-day moving average at 22.81. Resistance is seen near the 200-day moving average at 24.44. Short-term momentum is positive but decelerating as the fast stochastic converges to a crossover sell signal. The fast stochastic is printing a reading of 46.42. Medium-term momentum turns positive as MACD (moving average convergence divergence) index moves toward a crossover buy signal. This scenario occurs when the MACD line (the 12-day moving average minus the 26-day moving average) crosses over the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram prints in negative territory with an upward sloping trajectory. Negative momentum is decelerating, which points toward higher prices.
Inflation Surges to a 40-year High
According to the Labor Department, annualized inflation was the hottest since 1982. CPI increased by 7.5% year over year compared to expectations that it would rise by 7.2%. Core inflation which strips out food and energy, increased by 6%, also the fastest rise in core inflation since 1982. The increase in inflation was driven by food, electricity, and shelter costs.
This article was originally posted on FX Empire
More From FXEMPIRE:
