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Silver futures market analysis

Silver futures closed higher once again yesterday, having opened the trading session gapped up on the December daily chart, and perched above the $21 per ounce as a result. The bullish trend remains firmly in place for the industrial metal, which has continued to benefit from the twin drivers of continued risk on appetite in the equity markets, coupled with the pull through effect from it’s more illustrious cousin, gold, which is set to break out above the $1300 per ounce level in the short term. Tuesday’s price action was marked by a degree of volatility following the FOMC statement which hinted at further quantitative easing, now christened QE2, which saw silver futures pull back marginally on the day, but it is interesting to note the strong platform of support provided by the 9 day moving average, further confirming that the bullish trend remains firmly established. With all three moving averages pointing sharply higher, and with a strong platform of support now below, the picture is set for a continuation of the move higher, beyond the $22 per ounce high of 2008, and onwards into new high ground in due course. Silver futures are currently trading at $21.10 per ounce marginally lower this morning from a high of $21.24 per ounce.

The only fundamental news items for today, comes in the US trading session with the release of weekly unemployment figures which are forecast to remain flat at around 450,000, followed later in the trading session with the home sales figures which may give a small boost to equities and silver futures as a result in the afternoon.