Commodities Brief: Silver and Gold lead the way down as the liquidation continues

FXstreet.com (Barcelona) - The selling in commodities, which initially started during the Asia session after release of China GDP, continued throughout much of the European and US Sessions. News of two explosions near the finish line of the Boston Marathon was also released late in the session, which also sent US Equities sharply lower at the end of the day. The S&P 500 suffered its biggest drop of the year, closing down 2.26% at 1552.36.

The metals complex again suffered severe losses, with gold closing down 8.71% finishing at 1352.30. After suffering its biggest single day drop in 30 years, the shiny metal is now down 13.33% in the last two days. Silver also suffered another day of serious losses, closing down 12.68% at 22.65. Over the last 2 days, Silver has given up an astonishing 17.84%. The energy complex was not immune to the commodities weakness, with Crude Oil WTI closing down 3.91% at 87.39.

From a technical perspective, some major support levels have been breached in gold and silver which now act as resistance going forward. Due to the massive ranges, dropping down to the shorter term time frames to find important levels can be very helpful. Regarding gold, first resistance comes in at 1365 (the 9 DMA on 1 hour chart), followed by 1401 (the 20 DMA on 1 hour chart). First support is at 1332 (low price today), followed by 1297 (weekly chart support from June 2010). Initial resistance on silver comes in at 23.07 (the 9 DMA on 30 min chart), followed by 23.40 (the 20 DMA on 30min chart). Support sits at 22.42 (weekly resistance, now support from March 2008), followed by 22.00 (psychological level).