Silver price is down by more than 1% today as the rotation to the higher-yielding cryptocurrencies intensifies. The metal is trading at $24.13, which is in the same range it has been in the past few days. Similarly, gold and copper prices are also in the red.
Metals are falling at a time when the dollar index is down by more than 0.20% possibly because investors are shifting their resources to digital currencies that have grown by more than 200% in the past few months.
Silver price is also falling after Markit released mixed flash manufacturing PMI data. In Europe, the PMI dropped from 58.2 in October to 57.9 in November. That was a better reading than what most analysts were expecting. Similarly, in the Eurozone, the PMI dropped from 54.8 to 53.6. On a positive note, in the UK, despite the lockdowns, the PMI rose from 53.3 to 55.2.
These numbers are vital for silver because of its role in the industrial sector, where it used in the manufacture of solar panels, mirrors, and kitchenware.
Turning to the daily chart, we see that silver price has been in a tight range recently. During this time, it has formed an ascending channel that is shown in red. At the current price, it is slightly above the upper side of the channel. It is also between the 38.2% and 23.6% Fibonacci retracement level.
Therefore, the outlook for the metal is neutral but there are two potential outcomes. If it manages to move below the psychological level of $24 and the lower side of the channel, it could be a signal that bears have prevailed, which would see the price continue falling.
On the other hand, the price may test the lower side of the channel and then resume the upward trend as bulls aim for the upper side at $26.
