Silver prices reversed lower but held key support as copper prices rallied, helping to buoy silver. Silver is also used in electrical conduction and industrial capacities but is more expensive than copper. Gold prices tumbled, creating a dark cloud for the precious metals complex. U.S. yields surged higher, which seemed to put upward pressure on the dollar versus the yen and downward pressure on silver. Retail sales in the U.S. were stronger than expected, while sentiment declined.
Silver prices reversed and moved lower falling back to support near the 50-day moving average near 23.27. Prices made a higher high and a higher low which is a sign of an uptrend. Target resistdance is the September highs at 24.82. Short-term momentum turned negative as the fast stochastic generated a crossover sell signal in overbought territory. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory but the upward sloping trajectory is decelerating, which points to consolidation.
Sentiment Turns Lower
The preliminary estimate of the consumer sentiment index released by the University of Michigan decreased to 71.4 in October from 72.8 in September. The reading missed forecasts which estimated the index would come in at 73.0. In a separate report, Retail sales for the month increased by 0.7%, versus expectations that sales in September would decline 0.2%. Excluding auto-related sales, the number rose 0.8%, better than the 0.5% forecast.