Silver Futures traded at the Comex division of the New York Mercantile Exchange had its five-day average cross above their 20-day average on Tuesday, the same day as a MACD bullish crossover. Closing at $17.85, it appears that history suggests a further rally in silver futures.
Q: How has Comex silver performed in the past when, in the first half of the year, it experiences a MACD bullish crossover the same day its five-day average crosses above its 20-day average?
A: According to the 14 previous occurrences of this event, omitting repeat occurrences within 10 trading days, Comex silver has shown a somewhat bullish edge that peaks 25 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Tuesday, April 15, 2008) is Tuesday, May 20, 2008.
Silver rallies in 64% of the cases (9 of 14) by an average of 13.8% relative to the close on the event date. The average of the five declines is 1.6%. The overall return of the 14 cases is 8.3%, which, based on the close on the event date ($17.85), provides a target price of $19.332.
If you would like to see more details of this historical edge, go to www.markethistory.com
Ryan Soudan is an analyst with MarketHistory.com.
