Silver Prices To Trade At 15.98 If The Correlation To Gold Holds
Date
2/10/2016 3:04:28 AM
(MENAFN- DailyFX) With the DAX 30 reaching a new monthly low this morning silver prices may rally once again.
Technical Trend Is Bullish Above $14.90 Silver prices are consolidating after yesterday’s strong gains and traders will probably see a break to yesterday’s high of $14.49 as an opportunity to add to their bullish exposure. On a break to the high silver may reach the October 9 low of 15.62. A move higher is also suggested given the correlation to gold prices a simple linear regression analysis suggesting that silver is trading at a discount to gold and should be trading at $15.98 on gold prices trading at or above $1192 dollar per ounce. The alternative scenario is for silver to give back 50% of yesterday’s gains taking price to the $15.19 to $15.30 range and it is here that the risk/reward ratio favours long positions. For price to end its bullish momentum it would need to break below yesterday’s low of $14.90 and in this scenario price may reach Friday’s low of $14.68. German Industrial Production Declines And Adds To Bearish Sentiment Adding to the bearish sentiment this morning is German Industrial Production declining by 2.2% YoY in December. This suggests that E.U. GDP may have dropped to 0.63% YoY from 1.6% YoY in the third quarter of 2015 thereby triggering a softer DAX 30 which is now down by nearly 30% since its high in April 2015. Today U.S. NFIB Small Business Optimism Wholesale Inventories and JOLTS Job openings are on deck. See all data on our economic calendar. What are the DailyFX Top Trading Opportunities in 2016? Download your guide here. Silver Prices | FXCM: 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 Struggling with Trading? Join a London Seminar
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