Silver Price Crashes as Global Slowdown Fears Intensify
The recent rise in the US unemployment rate and the faster-than-expected contraction in the Manufacturing PMI for July have raised alarm bells about the US economy's trajectory.
Silver's Demand Slumps:
The demand for silver, a metal widely used in various industries, has been negatively impacted by concerns about a potential global recession. In particular, the economic slowdown in China, a major consumer of silver, has further exacerbated these concerns.
US Dollar Weakness Offers Little Support:
Despite a significant decline in US bond yields and the US Dollar (USD) due to expectations of a Fed rate cut in September, the silver price remains under pressure. The US Dollar Index (DXY) has fallen to a more-than-annual low near 102.60, but this has not been enough to offset the broader negative sentiment in the market.
Technical Analysis:
Silver prices have broken below a key support level around $28.60 and are approaching the 200-day Exponential Moving Average (EMA), which trades around $26.85. This suggests that the overall trend for silver remains uncertain.
The 14-period Relative Strength Index (RSI) has moved into the bearish range of 20.00-40.00, indicating a continuation of the downward momentum.