Silver Falls to New Cycle Lows

That is the lowest level in a year for silver, and the current bearish momentum could push the price below the psychological level of 20 USD pretty soon.

Chinese data improve

On the other hand, according to the official purchasing managers index, China's economy resumed growing in June. The PMI, which mainly measures the performance of major state-owned businesses, increased from 48.4 in May to 54.1 in June, with both manufacturing and services crossing back over the 50-point threshold that normally distinguishes expansion from contraction.

In the coming year, a US recession is "probably more likely than not," according to PIMCO's global chief investment officer for fixed income, Andrew Balls, who made the statement on Thursday. He put the likelihood of a recession at about 50% or even a little higher.

Balls also said that he sees market pricing of US Federal Reserve rate hikes as "reasonable."

200-week average under attack

Silver is now testing the 200-week moving average near 20.35 USD. That should be significant support, and if not held, the long-term trend could change to bearish. Another massive demand zone will be at the mentioned 20 USD level.

Alternatively, the short-term resistance is in the 20.80 - 21.00 USD region, and silver must climb above it to cancel the immediate bearish pressure.