Silver (XAGUSD) has started to trend downwards as the positive news from the US-China trade situation continues to filter through to the markets. At 3pm GMT, the Institute for Supply Management (ISM) will release the U.S. Non-Manufacturing (Services) Purchasing Managers Index. The outcome of this report could also provide some impact on risk sentiment.
News that the US could lift some tariffs from Chinese goods led to an improvement in risk appetite and ensured that any upward moves of the risk-bound commodities remain stalled. XAGUSD is currently trading at 17.998 (as at the time of writing), with intraday high and low levels at 18.07 and 17.97 respectively. Price remains locked within an upward channel, but with hardly any movement at all.
A look at the hourly chart will reveal that price has been locked in a tight range for several days now, with price action pushing towards the lower end of the range.
Intraday support continues to lie at 17.928, but price has to push below minor support at 17.975 to get to this level. A daily close below 17.928 is required to target the next pivot support level at 17.88 (intraday highs of Oct 28 – 30) and 17.81 (S2 pivot) below it.
On the flip side, a daily close below $18.07 continues the upside move to 18.18 (Nov 4 high). This will take the price towards the upper border of the channel on the daily chart. At this border, further resistance lies at 18.65 (Aug 29 and Sept 24 highs). A break of this resistance continues the long-term uptrend.