Silver price rout continues as JP Morgan cuts forecasts

The price of silver has hit a fresh four-year low so far in today’s trading, as JP Morgan reduced its forecasts for 2014 and 2015. The US non-farm employment payrolls report, due later today, poses a further threat to the precious metal.

Silver for immediate delivery had slid 0.58 percent, or nearly nine cents, to $15.30 as of 07:47 GMT, and was trading nearly 13 percent below its 50-day simple moving average of $17.56. It reached a fresh four-year low of $15.04 earlier today. Spot silver looks poised to record its fourth straight intraweek decline, it has tumbled nearly 12 percent over the period.

Today’s US Non-Farm Employment Change report, due at 13:30 GMT, from the Department of Labor, could provide more evidence of a strengthening economy, influencing the Fed and possibly reducing demand for silver and other zero-yielding assets.

Kitco News analyst Jim Wyckoff wrote:

The price of silver for December delivery was little changed, down four cents, or about 0.1 percent, to $15.32 as of 08:15 GMT on the COMEX in New York. The contract reached $15.04 earlier in today’s Asian session, the lowest since February 2010. According to a report by Scotiabank:

Based on the most actively traded COMEX contracts, those for December delivery, with a total volume of trade in gold and silver at 69,473 contracts as of 08:15 GMT today, the gold:silver ratio was at 74.40.

The recent increase in the ratio above 74 is the highest since March 2009. Scotiabank said: “Near term support is expected at 74.00, followed by 72.50, and we note that technical remain broadly suggestive of further upside.”