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The Spanish manufacturing PMI moved into contractionary territory for the first time in 13 months in February, with the 49.7 print well below the 51.4 consensus (vs 50.9 prior). This was the second consecutive decrease, and could suggest the recent momentum in Spanish industrial production is set to wane in the first few months of this year. Spanish January IP is due on Friday.

Key notes from the PMI release:

• “Companies reported notable uncertainty in product markets, linked to worries over future prices and ongoing geopolitical concerns. Lower demand was noted from key European markets, and this was crucial in reducing overall new export business for the first time in a year”.
• “Despite experiencing a drop in sales volumes overall, manufacturers were able to eke out some marginal production growth in February”
• “Employment levels declined slightly in February as firms generally avoided the replacement of any leavers at their plants”.
• “Input costs rose solidly in the latest survey period”…“Firms sought to pass these higher prices onto clients wherever possible, with the net result a second successive solid monthly rise in output charges”.

• MNI: SPAIN FEB MANUF PMI 49.7 (FCST: 51.4); JAN 50.9

• 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: $32.484/33.397 - High Feb 25 / 14 and the bull trigger                                 
• PRICE: $31.225 @ 08:04 GMT Mar 3    
• SUP 1: $30.815 - 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 

Silver weakness last week resulted in a move through both the 20- and 50-day EMAs. The move down - for now - appears corrective, however, a clear break of the 50-day average, at $31.399, would signal scope for a deeper retracement. This would open $30.691, the Feb 3 low. On the upside, the short-term bull trigger has been defined at $33.397, the Feb 14 high. Clearance of this level would resume the uptrend.