SILVER TECHS: Resistance Remains Exposed
- RES 4: $35.736 - 1.236 proj of the Feb 14 - Apr 12 - May 2 ‘24 swing
- RES 3: $34.903 - High Oct 23 and the bull trigger
- RES 2: $34.000 - Round number resistance
- RES 1: $32.765/33.397 - High Mar 5 / High Feb 14 and the bull trigger
- PRICE: $32.553 @ 08:11 GMT Mar 6
- SUP 1: $31.526/30.815 - 50-day EMA / Low Feb 28
- SUP 2: $30.691/29.704 - Low Feb 3 / Low Jan 27
- SUP 3: $28.748 - Low Dec 19 and bear trigger
- SUP 4: $28.446 - 76.4% retracement of the Aug 8 - Oct 23 bull cycle
Recent weakness in Silver appears to have been a correction and this week’s strong gains reinforce this theme. A continuation higher would refocus attention on the bull trigger at $33.397, the Feb 14 high. Clearance of this level would resume the uptrend. Moving average studies remain in a bull-mode set-up, highlighting a dominant uptrend. Key support to watch lies at $31.526, the 50-day EMA, and $30.815, the Feb 28 low.
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FRANCE DATA: France IP Disappoints; Driven By Weak Vehicle Production
France industrial production was weaker than expected in December at -0.4% M/M (vs -0.2% consensus, 0.1% revised prior from 0.2%). This is below the 2024 M/M average of -0.1%. On an annual basis it also disappointed at -1.7% Y/Y (vs -1.2% consensus, -1.1% prior) - the weakest annual reading since May 2024.
- The decrease was driven by manufacturing production falling 0.7% M/M (vs an increase of 0.2% in November) - the lowest sequential print since May 2024. Note manufacturing production makes up 82.53% of the overall industrial production weighting.
- Within manufacturing, manufacture of transport equipment drove the weakness with a fall in production of 5.4% M/M (vs a rise of 4.0% in Nov). This is the weakest print since January 2023. The sharp fall was due to vehicle production falling 11.0% M/M (vs an increase of 6.4% in Nov) - the lowest reading since May 2021 during the covid pandemic, as well as a 2.0% M/M fall in transport equipment production.
- The manufacture of other industrial products category also fell by 1.0% M/M (from -0.1% prior), mainly due to a decline in pharmaceutical production of 7.9% M/M (after an increase of 0.9% in Nov).
- Food manufacturing production rose 2.8% M/M (vs a fall of 0.6% in Nov), manufacture of capital goods rose marginally by 0.4% M/M (vs -1.1% prior) and coking and refining rose 0.8% (vs 0.3% prior).
- The remaining 17.47% weighting is made up of the 'extractive industries' production category, which moderated the downturn with a print of 1.2% M/M (vs 0.1% in November). The second successive positive sequential print and the highest reading since July 2024.
AUDUSD TECHS: Bearish Trend Sequence Intact
- RES 4: 0.6429 High Dec 12
- RES 3: 0.6384 High Dec 13
- RES 2: 0.6331 High Jan 24 and a key resistance
- RES 1: 0.6305 50-day EMA
- PRICE: 0.6271 @ 07:57 GMT Feb 5
- SUP 1: 0.6171/6088 Low Feb 4 / 3
- SUP 3: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6000 Round number support
- SUP 4: 0.5931 1.764 proj of the Sep 30 - Nov 6 - 7 price swing
AUDUSD continues to recover from Monday’s low. Despite these gains, the trend structure remains bearish. Monday’s cycle low confirmed a continuation of the downtrend and maintains the price sequence of lower lows and lower highs. A resumption of the bear leg would open 0.6045, a Fibonacci projection. Key resistance is at 0.6305, the 50-day EMA, and 0.6331, the Jan 24. A clear breach of both levels would alter the picture.
GILTS: Opening calls
Gilt Opening Calls, 92.91/92.97 range.
