- Silver breaches major high.
- The trend is bullish above the April 27 low of $17.08 low as it is the most recent swing low.
- Potential Market Moving Events on deck today are U.S. Employment Cost Index, PCE Deflator, and Chicago PMI.
Overnight, Silver Prices breached last week’s high of $17.71 and the May 2015 high of $17.80. Softer stock markets and US Dollar triggered the push higher.
The next major resistance is now the 2015 high of $18.51, a level that is 3.7% higher than the current price.
In the near term, the psychological level of $18 may act as resistance and followed by the January 27, 2015, high of $18.23.
Short-term support levels are the psychological level of $17.50, followed by the April 27 low of $17.08 and the April 25 low of $16.82.
The trend is bullish above the April 27 low of $17.08 low as it is the most recent swing low and a higher low in relation to this week’s low of $16.82.
Potential market moving events on deck today are U.S. Employment Cost Index, PCE Deflator, and Chicago PMI. The inflation readings are important for the Federal Reserve as they try to steer inflation towards 2 percent by either lowering or raising their policy rate. The Fed policy rate will in turn affect the USD.
If the PCE Deflator and Core PCE picks up more than expected it may prompt Dollar strength, which may lower the price of silver. On softer than expected readings the opposite may happen.
U.S. Employment Cost Index measures costs as wages and bonuses, but also indirect costs as social security contributions. The markets focus on this measure may notice going forward as it offers another glimpse of the labor market slack and inflation.
Silver Price | CFD: XAG/USD
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
— Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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