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Silver Futures Analysis 17 Sep 2010

Since the breakout of late August silver futures have continued to rise at a pace and almost without pause with yesterday’s market action being no exception, with the December silver futures contract ending as a narrow spread up candle and closing marginally below the $20.80 per ounce price point.  This increasingly pronounced upwards trend has continued in the overnight session on Globex with the commodity just breaching the $21 per ounce price handle at $21.02, before pulling back to trade at time of writing at $20.93 per ounce.  The trend higher has received excellent support from both the 9 and 14 day moving averages and with the 40 day average also now turning higher the outlook for silver futures remains firmly positive as the industrial metal continues to benefit both from the risk on appetite in equities coupled with the pull through effect from its more illustrious cousin, gold.  As all futures traders will know once a commodity starts to trend it will do so strongly and with conviction, and silver is no exception so expect higher prices to follow.

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