Spot Silver Prices - Daily Candle Chart 2009

Spot Silver Prices - Daily Candle Chart 2009

Yesterday spot silver prices reacted in much the same way as spot gold with a wide spread down bar on the day which penetrated the 40 day moving average and closed well below all three moving averages.  The fall was largely attributed to a combination of the Dow rising over 6% on news that Citigroup actually posted a small profit in January and February and Ben Bernanke’s assertion that this recession could be over by the end of 2009.  However, as I have said many times before the word “could” is hardly prove positive and has much the same impact as the word “if” which was used the week before by Ben Bernanke in another statement with much the same effect.  The markets rose temporarily only to fall back once a reality check had been taken.

Yesterday’s silver chart candle is interesting in that the low of the day is identical to that of 6 days ago – at 12.50 – which might suggest that is a temporary support point for any price fall.  However, given that all moving averages are now pointing lower and that the close of yesterday finished below the 40 day average then my suggestion for the next period would be small short positions with a view to taking profits off the table early as I believe this reversal is only temporary in nature and will, in due course,  revert back to the bullish trend of the last few weeks.  If we do see any significant falls then the next key support level will be at 11.50 per ounce for the price of silver.

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

Support:    $12.450 (yesterday’s low)                                   Resistance: $13.760 (high of 26/02/09)

Support:    $12.410 (low of 03/03/09)                                   Resistance: $13.410 (high of 09/03/09)

Support:    $12.280 (low of 05/02/09)                                   Resistance: $13.010 (yesterday’s high)