Silver Price Forecast: Options market signals discomfort with XAG/USD rally to $25.00
|Silver price (XAG/USD) seesaws around one-year high, making rounds to $25.00 during Wednesday’s initial Asian session after rising the most in three weeks the previous day.
In doing so, the bright metal portrays the market’s cautious mood ahead of the key US ISM Services PMI and ADP Employment Change for March. Also challenging the XAG/USD bulls are the signals from the options market suggesting the buyer’s doubt about the latest run-up in the bright metal’s prices.
That said, a one-month risk reversal (RR) of the Silver price, a gauge of the spread between the call and put options, prints the first daily loss mark in five while marking the -0.390 figure by the end of Tuesday’s North American session. It’s worth noting, however, that the weekly RR up for the fourth consecutive time, to 0.2000 by the press time, whereas the monthly options market signals are also firmer so far in April after posting the biggest gains in a year in March.
Hence, the short-term traders of the XAG/USD seem to have a lesser liking for the latest run-up in the Silver price, which in turn may trigger the quote’s pullback in a case where the scheduled US data print firmer outcomes and allow the US Dollar to rebound.
Also read: Silver Price Analysis: XAG/USD buyers eye $25.00 after breaking resistance around $24.25
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.