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Silver futures down 1% to re-approach 30-month low

Published 04/17/2013, 04:37 AM
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Investing.com - Silver futures were down during European morning hours on Wednesday, re-approaching the previous session’s 30-month low as investors continued to liquidate positions and exit the market.

On the Comex division of the New York Mercantile Exchange, silver futures for May delivery traded at USD23.39 a troy ounce during European morning trade, down 1% on the day.

Comex silver prices fell by as much as 2.1% earlier in the session to hit a daily low of USD23.11 a troy ounce. Prices fell to USD22.01 a troy ounce on Tuesday, the weakest level since October 5, 2010.

Silver prices were likely to find support at USD22.03 a troy ounce, the previous session’s low and near-term resistance at USD23.97, Tuesday’s high.

Silver futures have lost nearly 20%, or almost USD5.50 per ounce, in the three sessions leading up to Wednesday, as investors exited the market after prices broke below key support levels.

Prices of the silver metal are down nearly 53% since hitting an all-time high of USD49.81 an ounce in April 2011.

Silver has been on the decline given “weak industrial demand and mixed investor interest,” analysts at Barclays wrote in a research note last week.

Market analysts have warned that a drop below the USD22.00-level can lead to further losses in the near-term.

On Monday, the CME Group, operator of the Comex raised the amount of cash that traders must deposit for speculative positions by 18%, pushing, small investors out of the silver market.

Elsewhere on the Comex, gold for June delivery shed 0.5% to trade at USD1,380.95 a troy ounce, while copper for May delivery dropped 2% to trade at USD3.241 a pound.

Gold prices have lost nearly 16%, or almost USD240 per ounce, in the three sessions leading up to Wednesday, as investors exited the market after prices broke below key support levels.

Market analysts have warned that gold prices could fall further, as attitude towards the precious metal remains bearish. Bank of America Merrill Lynch said earlier in the week that bullion could fall to USD1,200  per ounce.

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