Spot Silver Prices - Daily Chart 10th February 2009

Spot Silver Prices - Daily Chart 10th February 2009

An interesting day yesterday for spot silver, and as I suggested yesterday, we were wise to be cautious in our approach. Even though the analysis of our chart for silver was in direct contrast to that for spot gold, the later still managed to drag spot silver prices lower yesterday, despite the fact that there was nothing to suggest this from a technical point of view. The key point to make is that in trading in any commodities it is vital to understand the relationships that exist between them and any strong correlations that exist. The gold silver relationship is one of these, and despite the fact that gold is a precious metal, and silver is an industrial one, this relationship still remains in place. So our analysis for spot gold yesterday was correct with a fall on the day, following the bearish candle of 6 days ago, whilst in silver this suggested a move higher. As a result of the move down in gold, this was reflected in a small down bar yesterday for spot silver which was unable to hold above the $13.00 level, which meant the white metal lost 20cents for the day stopping just above the 9 day moving average. However the charts still point to a bullish picture, which is slightly at odds with spot gold. If you are trading intra day I would suggest staying out of the market today, until we see a clear signal in the spot gold charts which will then provide us with a confirmation in spot silver.

The short, medium and long term trends are all bullish.

Support:    $12.790 (yesterday’s low)                                   Resistance: $13.390 (high of 29/09/08)

Support:    $12.732 (9 day moving average)                              Resistance: $13.203 (high of 06/02/09)

Support:    $12.491 (14 day moving average)                             Resistance: $13.110 (yesterday’s high)