Spot Silver Prices - Daily Candle Chart 6th March 2009

Spot Silver Prices - Daily Candle Chart 6th March 2009

Much of what I have just written about spot gold, also applies to spot silver today. Following the hammer candle of Tuesday, and the subsequent bullish signal of Wednesday, we did indeed see prices rise yesterday as expected, with the bounce of the 9 day moving average providing support. With the 14 day moving average now providing support in the daily chart, we should expect to see silver prices rise this morning, and my suggestion is therefore to attempt small long positions with tight stops below the hammer of Tuesday.

From a fundamental perspective, the main driver pushing spot silver prices higher was the big sell off in equities triggering  a flight to quality, with silver being considered a cheaper alternative to gold. Bargain hunting emerged after the recent downward correction which also added to the bullish influence. News of a continuing deterioration in the financial system and ongoing concerns about Eastern European economies look set to provide support for silver prices along with spot gold in short term. For today I would suggest closing out any profits early ahead of the weekend, and in this case we also have the NFP figures to consider – whether you trade through the news is for you to decide, but with the weekend ahead, and a big economic release, I would suggest closing out early! Good luck with your trading and have a great weekend.

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

Support: $12.861 (yesterday’s low) Resistance: $14.215 (high of 17/02/09)

Support: $12.631 (40 day moving average) Resistance: $13.760 (high of 26/02/09)

Support: $12.410 (low of 03/03/09) Resistance: $13.586 (14 day moving average)