Spot Silver Daily Candle Chart - 26th February 2009

Spot Silver Daily Candle Chart - 26th February 2009

Following gold, silver closed lower yesterday breaking and holding just below the 14 day moving average. The decline being marginally lower, could suggest that this is simply consolidation and the market taking a breather. However if market participants  continue to believe that governments can support the banking system, short of nationalisation and that inflation is to be tamed, silver and gold could be faced with further decline. For trading today I would suggest a wait and see approach – my own view is that the bull rally will continue for some time to come since the underlying problems in the economy will be here for several years to come, and the short term reversal therefore provides us as traders with an opportunity to identify entry points to the market for the longer term. Should prices fall below the 14 day average today, then we will need to wait for a reversal signal before buying into the market once again.

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

Support:    $13.552 (yesterday’s low)                                   Resistance: $14.420 (high of 18/02/09)

Support:    $13.530 (low of 17/02/09)                                   Resistance: $14.145 (yesterday’s high)

Support:    $13.480 (low of 16/02/09)                                   Resistance: $13.993 (9 day moving average)
The short term trend is sideways while medium and long term trends are bullish.

Support: $13.552 (yesterday’s low) Resistance: $14.420 (high of 18/02/09)

Support: $13.530 (low of 17/02/09) Resistance: $14.145 (yesterday’s high)

Support: $13.480 (low of 16/02/09) Resistance: $13.993 (9 day moving average)