Silver fell on Thursday ahead of the US jobless claims and services activity reports. The precious metal is expected to test the long term channel support before resuming the upside movement.
Technical Analysis
Silver is being traded near $19.80 an ounce at 11:20 GMT in London. Support may be seen around $19.69, the 23.6% fib level, ahead of the channel support which is currently sitting in near $19.65. A break and daily closing below the channel support could push the white metal into deeper correction, threatening the double bottom support area.
On the upside, hurdle can be noted around $20.13, the high of the previous candle, before the channel resistance which is being seen near $20.20. It is pertinent that the white metal will have to break a flurry support levels around $20.00-$20.50 before extending the upside movement above the $21.00 handle.
Initial Jobless Claims
The US labor department is due to release the jobless claims report today. According to the forecast, the number of people who claimed jobless benefits, during the previous week, rose to 317K as compared to 311K in the week before, better than expected actual outcome will be seen as bearish for Silver and vice versa.
Services PMI
The Institute of Supply Management (ISM) is also due to release the Non-Manufacturing Purchasing Managers Index (PMI) report today. Analysts have predicted an increase in the services activity during March. If the actual outcome misses the expectations, then it will be seen as bullish for the white metal and vice versa.
Conclusion
Silver has been holding a range since last four days because investors are seen cautious ahead of the nonfarm payrolls release which is scheduled on Friday. Keeping in view the supply concerns about the precious metal, steep correction is not expected in the short to medium term.
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