Precious metals prices have been highly sensitive to the US macro data published this week. The more signals there are for the Fed to hold back on stimulus tapering, the more reason there will be for gold and silver prices to trend higher.
Yesterday’s CPI data reflected an easing of inflationary pressures. Lower inflation has dampened investors’ impetus to look for a relatively rapid withdrawal of stimulus and weakened the dollar. Today, market participants will focus on US manufacturing production, with the median consensus calling for a lower print compared to July. After that, the focus will shift to retail sales.
Gold has an inverse relationship with the dollar, while silver in most cases tracks gold price trends.
Silver December futures saw gains last evening, have been consolidating around $23.84/oz and could trade within a range of $23.65-23.95 until US macro data come out. During the second half of the day, price action could reach $24 or a little higher if the manufacturing print is price-supportive. The next resistance levels are located at $23.91, $24.07 and then $24.18.