Silver prices are flat on Tuesday, after starting the week with small gains. In the European session, silver is trading at $17.66, up $0.02, or 0.03% on the day.
No Breakthrough in U.S-China Talks
It was just last week that investors were optimistic about the latest round of talks between the U.S. and China. There was hope that the sides might reach a “Phase 1” deal, which would suspend tariffs while leaving thorny issues such as intellectual property theft for another day. However, China is looking for another round of talks before agreeing to a limited trade deal with the United States. The Trump administration has suspended higher tariffs which were set to take effect this week, and the sides have some breathing room, with the next set of tariffs scheduled for December. Analysts expect a high-profile meeting shortly, which could set the scene for a “Phase 1” agreement. If the sides are able to ink a deal, safe-haven demand for silver could soften.
There is added pressure on China to show more flexibility in the negotiations, as the Chinese economy has been the big loser in the trade war with the U.S. In September, Chinese exports to the U.S. declined by 22%, on an annualized basis. The Chinese manufacturing sector is sputtering, as the Chinese Manufacturing PMI has pointed to contraction for the past four months.
Silver Technical Analysis
Silver has started the week in quiet fashion. The metal has remained range-bound for most of October and has not veered far from 17.50. The 50-EMA is providing immediate support at 17.46, and traders can expect the metal to remain in this area. Lower down, we find the 200-EMA at 16.90. On the upside, the round number of 18.00 has remained intact since late September.
This article was originally posted on FX Empire
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