silver

Not surprisingly, the silver market is also seeing a wholesale liquidation that is probably being accentuated by technical follow through selling. In additional to a downshift in US growth prospects, the silver market is also seeing some currency related pressure, as the lack of clear cut support for the US economy going forward has undermined the Euro. While the silver bears don't seem to need any additional help, news of rising Spanish debt yields overnight has served to gloss over potentially supportive UK economic readings. As in many other markets, the silver trade now shifts its focus toward US economic readings at the end of the week but given estimates for upcoming reports, there might not be enough good news to markedly alter negative sentiment. While some players might suggest that silver wasn't as overbought in the last COT report as the gold market, silver was long enough to suggest that part of the steep losses this week were probably technical in nature. Others are suggesting that silver's relative out performance of gold recently, is now set to add to the downside action in silver prices. In fact, press coverage on silver in a major US publication released overnight, suggests that silver is likely to decline sharply and then become bound in a tight trading range. It could take a series of better than expected US scheduled numbers to rekindle positive macro economic vibes and today's numbers might not be of a high enough caliber to shift sentiment. Comex Silver Stocks were 138.488 million ounces down 109,320 ounces. Silver stocks have increased 13 of the last 20 days. For the time being the bull bubble is burst with the trade settling on the idea that the US Fed is on hold and that the US economic recovery will mostly be left to its own devices. With initial but weak support seen at the March 29th low of $31.63, the bear camp should feel confident in their control over silver prices. In fact, a slide down to the March 22nd low of $31.09 could become a near term target for silver, especially if any US data points hints at anemic growth. Relatively high open interest into the March highs and then again into this week's highs, might serve to fuel even more long liquidation pressure. In order to throw off our bearish view probably requires a rise back above $32.62 in May silver.