This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Silver Prices Could Face Volatile Week

NEW YORK (TheStreet) -- Technical indicators imply a volatile week ahead for silver. The dollar could rally on data releases while overall concerns of the strength of economic recovery loom large, increasing volatility in the white metal.

Last week, COMEX silver futures for September delivery were highly volatile to close at $18.11 an ounce. The candlestick formation indicates uncertain price trends, supporting higher volatility in silver this week. The white metal is strengthening and a bullish trend is certain if it breaches and sustains above the $19 an ounce mark this week. The weekly RSI is currently at 0.51, raising the target to 0.70, after touching the lower trend line.

The dollar may rally this week, as data releases are likely to show optimism in the U.S. economy. Rising housing starts and improving industrial production data may boost market sentiment. Moreover, manufacturing indicators such as the Empire State manufacturing and Philadelphia Fed indices are expected upbeat.

However, building permits may contract and continuing claims may rise, limiting any upside in the dollar. The European ZEW survey for economic sentiment is expected to decline, while China's slowdown fears could hit global equity markets.

Last week, silver tracked corrections in base metals, which declined more than 3% on the London Metal Exchange. The white metal failed to take cues from gold and was down nearly 2%. In addition to corrections in base metals, mounting concerns of a weak global economic recovery and tumbling equity markets dragged silver prices lower.

The gold-silver ratio advanced to 67.09 from 65.15. Meanwhile, silver prices for spot delivery on the COMEX closed at $18.15 an ounce, while futures ended at $18.11 an ounce, suggesting that silver prices are in backwardation. In contrast, COMEX gold for spot delivery closed at $1215.50 an ounce, while futures ended at $1215.40 an ounce, indicating that gold prices are in backwardation as well.

The calendar spread (the difference between two futures contracts) between silver Sep'10 and Dec'10 remained thin at -0.056, signifying that the far month contracts closed higher than the near month contracts. Meanwhile, the calendar spread between gold Oct'10 and Dec'10 contracts hovered at -1.20 past week.

Among major silver producers, the top silver stock pick for over five months Silver Wheaton (SLW) was up 0.25%, while Pan American Silver (PAAS) was down 3.24% last week. Although these companies reported record quarterly earnings on higher realized prices and production volumes, earnings per share were below analyst estimates.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,943.81 +28.74 0.17%
S&P 500 1,967.57 +2.89 0.15%
NASDAQ 4,415.49 +19.2860 0.44%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs