Silver May Extend Slide to Lowest Since June: Technical Analysis
Lausanne-Switzerland (Nov 21) Silver, which slid the past three weeks in the worst run since July, may drop to the lowest level since June, according to technical analysis by MIG Bank.
Prices fell last week below a “key support” level at about $20.50 an ounce last seen on Aug. 9. The metal may drop toward about $18.23, the lowest since June 28, said Luc Luyet, a senior analyst at MIG in Lausanne, Switzerland.
“The short-term technical structure is negative as long as prices remain below the resistance at $20.92,” Luyet wrote in a report yesterday. “The break of the key support at $20.50 favors a move towards the next key support at $18.23.”
Silver for immediate delivery traded at $20.4335 by 6:17 a.m. in London and reached $20.2254 yesterday, the lowest since Aug. 9. Prices slid 33 percent this year as some investors lost faith in precious metals as a store of value. It’s the second-worst performer, after corn, in the Standard & Poor’s GSCI gauge of 24 commodities.
In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.