- Silver price drops sharply to around $28.20 as US Dollar rises further.
- Traders are divided on the potential size of the Fed’s rate cut at its September meeting.
- Investors are awaiting US manufacturing PMI data for August.
Silver (XAG/USD) price extends its losing streak for a third trading session on Tuesday. The white metal drops near $28.20 as the US Dollar (USD) rises further amid uncertainty ahead of a slew of US economic data this week.
The US Dollar Index (DXY), which tracks the value of the greenback against six major currencies, rose toward a new two-week high of 102.00.
Investors are eagerly awaiting the US Non-Farm Payrolls (NFP) data for August, due on Friday, as it will influence market speculation on the likely size of the interest rate cut by the Federal Reserve (Fed) at its September meeting.
The Fed is widely anticipated to begin cutting interest rates this week, but traders are divided on whether the central bank will start the policy easing cycle gradually or aggressively. In addition to the US NFP report, investors will also be focused on the JOLTS job openings data for July and the ADP employment change for August, due out on Wednesday and Thursday, respectively, which will provide fresh clues on the current state of the labor market.
In today’s North American session, investors will focus on the US ISM manufacturing PMI data for August, due out at 14:00 GMT. The US manufacturing PMI is estimated to have improved to 47.5 from July’s reading of 46.8, but a reading below 50.0 is itself considered a contraction.
Technical analysis of Silver
Silver price is weakening after a breakout of the head and shoulders chart pattern on a 4-hour time frame, whose neckline is drawn near $28.80. The downsloping 20-period exponential moving average (EMA) near $28.80 suggests that the short-term trend is bearish.
The 14-period RSI is shifting into the bearish range of 20.00-40.00, suggesting strong bearish momentum.
Silver four-hour chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
