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Silver Continues Upswing, Pushes Above 17.00

FX Empire, FX Empire
0 Comments| December 16, 2019

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Silver continues to its slow-but-sure upward move. The metal posted gains of 2.1% last week and has crossed above the symbolic $17.00 level.

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Silver prices have started the new trading week with gains. In the European session, silver is trading at $17.04, up 0.65% on the day.

Trade Deal – the Devil is in the Details

The U.S. and China announced on Friday that a limited trade deal had been reached, after more than two years of protracted and difficult negotiations. U.S. Trade Representative Robert Lighthizer said on Sunday that the deal was “totally done”, although no date has yet been announced for a formal signing. At the same time, some issues remain, such as the scale of Chinese purchases of U.S. agricultural products. U.S. President Trump insisted that China would buy $50 billion worth of U.S. farm goods “pretty soon”. However, this claim could prove to be over-optimistic. Ting Lu, chief China economist at Nomura, noted that “the scale of purchases seems implausible and Chinese officials were reluctant to mention any specific target during their press conference.” The agreement has led to immediate dividends – the U.S. held off from implementing new tariffs on Sunday and China also agreed not to apply retaliatory tariffs.

Retail Sales Slip

Consumer spending was soft in November, which could be a worrying sign ahead of the crucial Christmas shopping season. The headline figure dipped to 0.2%, down from 0.3%. This was shy of the estimate of 0.5%. Core retail sales slowed to 0.1%, compared to 0.2% a month earlier. This missed the forecast of 0.4%.

Silver Technical Analysis

The silver price forecast remains neutral, as it is unclear which direction the pair will take next. On the upside, the 200-EMA is at 17.14, just below resistance at 17.25. On the downside, we find immediate support at 16.93. This is followed by the 50-EMA, at 16.72. Next is 16.50, which has held since August.

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