Compiled 07/18/08 6:00 AM (CT)

Statistics: London Gold Fix $961.50 -$3.00 LME Copper stocks 128,550 tons +650 tons

SILVER MARKET FUNDAMENTALS: (6:00 AM CT) With a moderate early failure in silver prices today it would not seem like flight to quality concerns were rekindled enough in the wake of the Merrill earnings to leave silver prices in a positive bias. In fact, despite a weaker US Dollar and higher oil prices early today, neither gold nor silver prices have managed a positive early trade and that has to make the bear camp somewhat confident heading into the Friday trading session. Given the focus on the ebb and flow of the financial situation in the US, the silver market probably won't give any attention to the news of another new all time high in silver holdings, at a noted silver ETF overnight. In fact, with all the actively traded metals markets showing early weakness today, the onus could be on the bull camp to prove that they can reverse the early downside thrust on the charts.

OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) Prior to the Citi group earnings news this morning, the gold and silver markets were already seeing a rekindling of US Financial sector concerns in the wake of poor earnings news from Merrill Lynch. The gold and silver bulls were also initially emboldened by a $2 per barrel rise in crude oil prices off renewed turmoil and production losses in Nigeria. In fact, the gold and silver bulls also seemed to be poised to derive some support from renewed weakness in the US Dollar in the wake of disappointing tech sector earnings news, but once again the Citi results have apparently saved the Dollar. While some players might suggest that JP Morgan, Wells Fargo and Citi earnings news this week hints that the financial crisis is coming under some control again, the trade also recognizes that the write down levels in the financial sector remain really high and that could eventually leave the flight to quality mentality in place.

Technical Analysis:
Note: Compiled during previous session 07/17/2008 at 3:20 PM CBOT SILVER (SEP) 07/18/2008: Momentum studies trending lower from overbought levels is a bearish indicator and would tend to reinforce lower price action. The market's close above the 9-day moving average suggests the short-term trend remains positive. A negative signal was given by the outside day down. It is a slightly negative indicator that the close was lower than the pivot swing number.