Silver and Gold Market Update

April 6, 2009 - Email Alert Sent 12:38 PM New York Time

          As I write this, Silver is trading at $12.17 and Gold at $871. Both have broken through long term levels of support at $12.50 and $890. It is likely that they will end the day below those values. If the metals are unable to regain those levels in the next few days, then we will probably see further weakness in the short term. $11.50 is a strong support level for silver that should hold. Gold has more speculative interest right now and may not hold above $850. If the $850 level fails, then we would likely see gold bottom in the low $800 range.

          I see the present weakness as a great buying opportunity for investors looking to add to unleveraged physical bullion purchases. Unfortunately, I can't give specific individual trading advice. If you choose to trade the metals at this volatile time, it is important that you formulate a good exit strategy should further weakness develop. As a general rule, one should never enter a trading position without planning in advance the strategy for minimizing loses should the position turn against you. Failure to follow this rule pretty much assures that sooner or later your trading account will run out of money.

          Right now, market sentiment has turned against the metals and other safe-haven assets as investors cheer "good" news from the G20 economic summit and changes to mark to market rules. I think stocks are in a bear market rally currently, not the beginning of a new bull market. Many companies will be reporting earnings this week, and some bad surprises could turn equities back out of favor. It is hard to say how long the current weakness in the precious metals will last, as it is so dependent on the level of investors' demand for safe assets. I will continue analyze changes to the market and send updates with my latest thoughts.

Best wishes on your investing and future and God Bless,

Timothy Silvers

 

Disclaimer: This article represents the opinions and personal views of Timothy Silvers and is not intended to be investment advice. If you choose to use this analysis for your personal trading, Timothy Silvers assumes no liability for the direct or indirect losses you may incur due to using this article to make your investment decisions. You are totally and completely responsible for your own investments. At any given time, Timothy Silvers or his friends and relatives may have positions in silver related investments that may or may not follow the recommendations contained in this article. The information in this article may not be completely correct and accurate. Even though Timothy Silvers has done his best to review the content and accuracy of this article, he is in no way liable or responsible for any mistakes or omissions.