RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

A lot of news and a volatile week in the markets have created a lot of volatility, with silver being no exception. The PPI report on Wednesday showed a 0.2% increase, which matched the estimates from analysts.  The CPI report on Thursday showed an increase of 0.1 %, which marked the sixth increase in a row, but there were higher estimates out.  A strong economy, coupled with the unemployment at a 48 year low, has led to an increase in inflation.  This increase in inflation has led to what seems like “fear correcting” in the equity markets.  The markets have closed low for six consecutive days, with the Dow Jones Average losing 1375 points in two days.  With the massive sell-off this week in equities, people have rushed into the metals as a safe haven. Silver posted close to a $.30 cent gain on Thursday, almost getting back what it had lost on Monday and throughout the week.  Last Friday, December silver was at $14.68 an ounce, with Thursday’s close at $14.62 an ounce we are not far off from where we started.  Further support was added with the dollar index breaking this week as well.

Looking forward, I expect silver to remain range bound between the highs and lows created from the beginning of September, which has shown a recent high of $14.95 to a low of $13.96.  We have support in the December silver at $14.42 and resistance at $14.79.

Silver Sep ’18 Daily Chart

Silver Sep '18 Daily Chart

Tom Beller