Spot Silver Price Chart - Daily Silver Prices 15th June 2009

Spot Silver Price Chart - Daily Silver Prices 15th June 2009

Spot silver prices fell sharply on Friday as a result of profit taking and a growing realisation by investors that any economic recovery is likely to be long and drawn out.  In addition strong gains in the US dollar prompted by bearish comments from the ECB’s Jean Claude Trichet and positive support for the greenback from Japan’s Finance Minister Kaoru Yosano also contributed to the pullback in silver prices.  Overall spot silver lost 60 cents, dipping below the $15 per ounce price point, to close at $14.790 per ounce, ending the day on a wide spread down bar.  From a technical perspective Friday’s candle finally confirmed the 2 bearish engulfing signals that we saw in the previous week’s trading, and coupled with the crossing of the 9 and 14 day moving averages this has now confirmed the bearish picture in the short term.  Indeed this has been reinforced in early trading this morning with a gapped down opening (falling window) which suggests that the bearish tone may continue for some time.  The key to the depth of this move will depend on two factors, firstly whether silver prices break below the 40 day moving average and secondly whether they find a modicum of support in the $14 per ounce price region.  If the first occurs, and the second fails to provide support, then we could see a deeper move possibly as far as the $13 per ounce region once again last seen back in early May.

The short term bearish, medium term sideways, long term bullish.

Support:    $14.767 (Friday’s low)                                      Resistance: $15.440 (Friday’s high)

Support:    $14.620 (low of 28/05/09)                                   Resistance: $15.276 (14 day moving average)

Support:    $14.430 (low of 27/05/09)                                   Resistance: $15.118 (9 day moving average)