Silver Price Analysis: XAG/USD turns volatile as investors weigh in on the US NFP report.

• Silver offers stock volatility as investors carefully scrutinize the US NFP report.
• The dollar fell as investors expected slowing wage growth to ease the boost in consumer spending.
• Silver is facing some selling pressure on its rally towards the horizontal resistance around $25.27.

The price of the Silver (XAG/USD) shows volatile action above $24.50 as investors carefully scrutinize the US Non-Farm Payrolls (NFP) data for August. The US Bureau of Labor Statistics reported fresh payrolls at 187,000, beating estimates of 170,000, and revised down July’s reading of 157,000.

The unemployment rate rose sharply to 3.8%, against estimates and the previous rate of 3.5%. Average monthly earnings per hour grew at a slower 0.2% pace, while investors anticipated a 0.3% pace in wage growth. In July, the labor cost index increased by 0.4%. Average annual hourly earnings nominally slowed to 4.3%, versus estimates and the previous release of 4.4%.

Slower wage growth could offset the impact of higher-than-expected new payrolls, allowing the Federal Reserve (Fed) to keep interest rate policy unchanged on September 20. Meanwhile, investors are still waiting for the US ISM Manufacturing PMI, due at 14:00 GMT.

The Dollar Index (DXY) falls marginally to near 103.40, as investors expect slower wage growth to ease consumer spending momentum and tame inflation. Additionally, 10-year US Treasury yields fell to around 4.10%.

Silver Technical Analysis

Silver is facing some selling pressure as it runs higher towards horizontal resistance drawn from the July 20 high around $25.27 on a two-hour scale. The bullish 20-period EMA continues to provide support for silver bulls.

The Relative Strength Index (RSI) (14) falls to the 40.00-60.00 range from the 60.00-80.00 bullish range, indicating that the bullish momentum has faded.

2 hour chart