By Debarati Roy - Sep 16, 2011 6:00 AM GMT+0700
Silver futures may extend this month’s decline, the first since June, according to technical analysis by Steel Vine Investments LLC.
The precious metal probably will slide to $38 an ounce by the end of September, down 3.8 percent from yesterday’s closing price on the Comex in New York, after the commodity dropped below the support level on a trendline connecting the lows of July 1 through Sept. 7, according to Spencer Patton, the Chicago-based chief investment officer for Steel Vine.
Yesterday, silver futures for December delivery fell $1.032, or 2.5 percent, to settle at $39.501. Prices rallied in July and August and have more than tripled since 2008. On April 25, the metal reached $49.845, the highest since January 1980.
“Silver, which was showing signs to trend higher, broke below the medium-term uptrend line” on Sept. 12, Patton said in a telephone interview yesterday. “Silver looks vulnerable.”
In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.
To contact the reporter on this story: Debarati Roy in New York at droy5@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
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