Silver Spot Price Chart - Daily Candlesticks 27th May 2009

Silver Spot Price Chart - Daily Candlesticks 27th May 2009

Spot price silver initially suffered from heavy selling as investors reacted to the growing problems with North Korea by moving back into the US dollar as risk aversion returned once again to the markets.  However, this was short lived as equity prices rose along with copper prices, which these days appear to correlate positively with spot silver prices.  The price of silver managed to restrict losses to 13 cents closing the session at $14.507 per ounce.  From a technical perspective the silver chart is almost identical to that of spot gold in that it has a spinning top from Monday (created on thin volumes and therefore suspect), followed by a doji with a deep lower wick which bounced off the 9 day moving average.  Under normal circumstances I would suggest that this could represent a short term reversal as some weakness has entered the market, but given the unusual circumstances outlined above and a continuation of the market’s trading on sentiment rather than fact I hesitate to draw any firm analysis of the past couple of days and would therefore suggest we take a wait and see approach for any clear signals from today’s trading.

The short and medium term are sideways while the long term is bullish.

Support:    $14.280 (yesterday’s low)                                   Resistance: $14.940 (high of 13/08/08)

Support:    $14.060 (low of 22/05/09)                                   Resistance: $14.780 (high of 25/05/09)

Support:    $13.970 (low of 18/02/09)                                   Resistance: $14.700 (yesterday’s high)