Current trend

During the Asian session, the XAG/USD pair is correcting after yesterday’s growth, when it briefly renewed the highs of September 26 and is trading at 31.60, waiting for new drivers.

Market activity is restrained, as investors are awaiting the September US labor market report at the end of the week. Forecasts suggest that nonfarm payrolls will remain at 140.0K, the unemployment rate – at 4.2%, while the average hourly earnings may consolidate at 3.8% YoY and decrease from 0.4% to 0.3% MoM. Investors do not expect these statistics to significantly change the estimates of further US Fed monetary policy change until the end of the year. Recall that the head of the regulator, Jerome Powell, spoke out against adjusting the interest rate by –50 basis points since the situation allows officials not to rush into making decisions. Experts expect at least one more change in the indicator by –25 basis points in November and, possibly, a second one in December.

The asset is supported by the increase in geopolitical tensions after the missile attack on Israeli territory by Iran, which official Tehran called a response to the liquidation of the leaders of the Lebanese paramilitary organization Hezbollah and the Palestinian movement Hamas.

Meanwhile, a correction in the market continues. According to the latest report from the US Commodity Futures Trading Commission (CFTC), last week, net speculative positions in silver increased from 58.3K to 62.2K. The “bulls” are increasing their advantage, maintaining the positive dynamics of the quotes. According to the report on positions secured by real money, their balance is 58.519K against 12.431K for the “bears”. Last week, buyers opened 5.318K contracts, while sellers opened 1.542K, which reflects increased activity of all investor categories.

Support and resistance

On the daily chart, Bollinger bands are reversing horizontally smoothly. The price range remains spacious for activity in the market. The MACD indicator is declining, maintaining a poor sell signal (the histogram is below the signal line). Stochastic did not reach “20” and reversed into an ascending plane, reacting to the appearance of corrective growth. It is better to wait for the signals to open trading positions to become clear.

Resistance levels: 32.00, 32.29, 32.60, 33.00.

Support levels: 31.56, 31.15, 30.75, 30.50.

Trading tips

Short positions may be opened after a breakdown of 31.56, with the target at 30.75. Stop loss – 32.00. Implementation period: 1–2 days.

Long positions may be opened after a rebound from 31.56 and a breakout of 32.00, with the target at 33.00. Stop loss – 31.56.