Silver extended downside movement on Thursday, dragging the price of white metal to less than $17.00 following the release of some key economic news. The technical bias remains bearish because of a lower low in the recent downside move.

Technical Analysis

As of this writing, the precious metal is being traded near $16.82. A support may be noted around $16.80, the trendline support area ahead of $16.73, the short term horizontal support and then $15.62, the swing low of the last major downside move as demonstrated in the given below daily chart.

On the upside, the precious metal is expected to face a hurdle near $17.32, the short term horizontal resistance ahead of $17.86, the 50% fib level and then $19.00, the confluence of psychological number as well as swing high of the last major upside rally. The technical bias shall remain bearish as long as the $19.00 resistance area is intact.

New Homes Sales

New U.S. single-family home sales fell to a 10-month low in December after three straight months of strong gains. The Commerce Department said on Thursday new home sales dropped 10.4 percent to a seasonally adjusted annual rate of 536,000 units last month. November’s sales pace was revised up to 598,000 units from the previously reported 592,000 units. Economists polled by Reuters had forecast single-family home sales, which account for 8.9 percent of overall home sales, slipping 1.0 percent to a 588,000-unit rate last month.

Trade Idea

Considering the overall technical and fundamental outlook, selling the precious metal on a daily closing below the trendline support area appears to be a good strategy.