A sustained move above $31.29 could generate new buying interest, but traders are encountering resistance at the 50-day moving average of $31.70. A clear break above this level would indicate stronger bullish momentum, with the next targets ranging from $32.28 to $32.89.
Conversely, failure to hold $31.29 could lead to a pullback to a secondary pivot at $30.61. Breaking this support would expose silver to a test of its recent low at $29.64 and the critical 200-day moving average at $29.32, which could act as a floor for prices.
Treasury yields fall after jobs report
Treasury yields fell as the NFP report at the December 17-18 meeting reinforced expectations of a Federal Reserve rate cut. The yield on ten-year government bonds fell by 4 basis points to 4.14%, while the yield on two-year government bonds fell by 6 basis points to 4.08%.
Nonfarm payrolls rose by 227,000 in November, surpassing the consensus estimate of 214,000, while the unemployment rate rose to 4.2%. This increase, which was accompanied by a decline in labor participation to 62.5%, fueled market speculation about further monetary easing. Traders now see an 88% chance of a 25 basis point rate cut.
Fed’s interest rate outlook and labor market trends
Despite stronger-than-expected wage growth, recent comments from Fed Chairman Jerome Powell underscore a cautious approach to rate cuts. Powell highlighted improved economic conditions, noting the resilience of the labor market and declining downside risks.
“The good news is that we can afford to be a little more cautious as we try to find neutral,” Powell noted earlier this week.