SILVER

The silver market is also showing some minor corrective bounce action this morning but outside market forces don't appear to be definitively supportive to start. However, May silver to the lows yesterday have already mounted a decline of roughly 43 cents an ounce and therefore some traders are suggesting that the gains this morning are simple technical short covering. With a negative ongoing vibe flowing from China and mixed global equity market action, the bear camp would seem to have maintained control over the physical commodity market trading environment. For silver to throw off this week's corrective bias, probably requires evidence of falling Italian debt yields, an as expected US GDP reading and perhaps better than expected US claims figures. Some traders are even suggesting that fear of a major environmental disaster from a North Sea natural gas platform accident is serving to keep global equities and physical commodity markets under pressure this morning. Other traders want to see clearly defined direction from the US Fed before they turn bullish toward silver and other physical commodity markets. Comex Silver Stocks were placed at 136.518 million ounces yesterday afternoon for a daily gain of 867,610 ounces. Comex Silver Stocks are now at the highest level since 10/03/2008. Silver stocks have increased 14 of the last 20 days. There might be little in the way of support in the May silver contract until the $31.78 level. Additional and slightly lower support is seen down at the March 23rd low of $31.45. Without a rise back above $32.32, the path of silver prices might continue to point downward. Ongoing weakness in energy prices might ultimately be supportive of the global economy and that could eventually be supportive of silver and other physical commodities. However, in the near term ongoing weakness in energy prices might simply foster deflationary vibes and in turn foster classic technical pressure in certain physical commodities.