Silver Price Prediction – Prices Consolidate as U.S. New Orders Slide

Silver prices moved sideways, forming a doji day which is a sign of indecision. This occurs when the open and the close are at the same level. The weaker than expected U.S. ISM manufacturing report likely weighed on prices, but declining yields offset this momentum. Gold prices were also unchanged but U.S. Yields moved lower following the softer than expected ISM manufacturing report. Copper prices moved lower which also weighed on silver prices.

Technical analysis

Silver prices moved sideways on Monday, consolidating in the middle of last week’s range.  Support is seen near the 10-day moving average at 25.21. Resistance is seen near the July highs at 25.80. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal.  Medium-term positive momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

Forward Look Orders Slide

Not only did the ISM survey slip below 60 missing expectations, but the ISM forward-looking new orders sub-index fell to a reading of 64.9 last month from 66.0 in June. That was the second consecutive decline in a row.  Part of the problem is that shipping rates are elevated, and there is a lack of containers to move new products to future destinations. Production at factories declined, which has led to a rise in backlogs. Without employees to accelerate the process, orders will continue to slide.