- US Dollar soars across the board after NFP.
- US ISM Service brings in more favourable data.
- Silver drops by more than 3% on Friday; down 8% from Thursday’s peak.
Metals extended the sell-off after the US official employment report. Silver hits fresh monthly lows near $22.50 and is having the worst day in months.
Strong labor market, Service sector expanding again
US economic data released on Friday came in above expectations, reflecting a strong labor market and an improvement in service sector activity. The numbers boosted the US Dollar and Treasury bond yields. Wall Street is moving without a clear direction.
The data published on Friday by the US Bureau of Labor Statistics (BLS) showed that Nonfarm Payrolls rose by 517K in Januarysignificantly above the market expectation of 185K. November and December’s figures were revised higher. The unemployment rate dropped unexpectable to 3.4%.
A different report released more recently revealed that economic activity in the service sector turned into expansion territory in January with the ISM Service PMI rising from 49.2 in December to 55.2, surpassing the market expectations of 50.4. In addition, the Price Paid Index dropped modestly from 68.1 to 67.8, above consensus of 65.5.
Silver hit a fresh low after the ISM data at $22.47, the lowest since December 7. As the end of the week looms, XAG/USD attempts to trim losses and trades at $22.65, down 3.40% for the day. From Thursday’s high it has fallen 8%.
Technical added pressure to XAG/USD and suggest at the moment that more losses are likely. Price is breaking a one-and-a-half consolidation range to the downside, after being rejected again from above $24.00.
Interim support emerges around $22.50, and below is the strong barrier at around $22.00. A recovery back above $23.00 could alleviate the bearish pressure.
XAG/USD daily chart
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.