04/01/2014 10:01am CDT
I would like today's article to have more foolishness behind it, but the fact is the silver market has broken below the 20 level for the past five sessions, possibly six makes me serious. The breather this market has taken over the past three sessions only appears to be setting it up for another leg lower. This puts 19500 as near term support with 20625 as level one resistance and 22215 as level two resistance. A break above either of those levels would be a continuation of the bull trend, where a failure at this level will continue the recent bear trend.
On the physical side, January had the biggest demand for Silver Eagle coin with 4,775,000 sold. February saw a brief drop to 3,750,000, but further demand continued in March with the lower prices bringing 4,476,000 coins sold. In comparison, Gold Eagle coins also had their biggest sales month this year in January, but have dropped off aggressively the following months. With the lower prices physical investors are finding the values to purchase silver more so than gold. The economic picture remains fairly mixed with numbers slightly improving, but the weather has been a significant factor with poor reports recently. As the unseasonably cold stops, if these numbers don't improve it could help provide even more support for these metals, as the economy can be on more unstable footing.
Looking back to the futures, if you'd like to play this market for a bounce or for a further continuation of the recent bear trend, both of these opportunities are setting up for a fairly tight risk/reward. Contact me for details and we can discuss the different opportunities.
If you'd like to learn more about futures trading or the silver market specifically, please contact Mike Rataj at 800-453-4494 or firstname.lastname@example.org.
May '14 Silver Daily Chart
Source: RJO Futures PRO