IV:Silver futures extends rally as bullish sentiment remains intact
Investing.com - Silver futures extended strong gains from the previous session to hit the highest level since mid-June on Tuesday, as investors’ awaited a report on U.S. retail sales later in the day, a data point that will be scrutinized for its potential impact on the Federal Reserve's monetary policy stance.
Investors have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases.
Any improvement in the U.S. economy was likely to reinforce the view that the central bank will begin to taper its bond purchase program in the coming months.
Moves in the silver price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.
On the Comex division of the New York Mercantile Exchange, silver futures for September delivery traded at USD21.70 a troy ounce during European morning trade, up 1.7%.
Silver futures hit a session high of USD21.73 a troy ounce earlier in the day, the strongest level since June 19.
Silver prices were likely to find support at USD20.06 a troy ounce, Friday’s low and resistance at USD21.87, the high of June 18.
The September contract settled up 4.6% at USD21.33 a troy ounce on Monday.
Market players were looking ahead to Tuesday’s retail sales report, as well as data on inflation, industrial production, housing starts and consumer confidence later in the week, amid ongoing speculation over how soon the Fed may start to pull back its asset purchase program.
Silver prices are on track to post a loss of almost 33% on the year, amid concerns the U.S. central bank will start to taper its bond purchasing program in the coming months.
Elsewhere on the Comex, gold for December delivery rose 0.1% to trade at USD1,335.80 a troy ounce.
Meanwhile, copper for September added 0.6% to trade at USD3.332 a pound. On Monday, prices rose to a ten-week high of USD3.328 a pound.
Appetite for the red metal remained supported amid receding concerns over a slowdown in China’s economy.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
