Technical Analysis: Bullish Silver Spread Betting Market Nears Recent Highs
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A closer look at the chart below shows that silver is currently well off the maximum levels it reached towards the end of April 2011.
On 25th April last year the commodity briefly touched $49.805 before starting to fall back. Since then we have not seen anything approaching that level again. The nearest it came to that record price was $44.155 on 23rd August 2011.
The current price of $34.115 is significantly lower than the average price for last year. It is also still marginally lower than the recent maximum of $35.655 we saw on 28th October last year.
Since the end of December, however, we have seen something of a bull run in the silver spread betting market. The current price is significantly higher than the minimum of $26.125 we saw on the 29th of December last year.
Technical analysis of the chart below clearly shows that the price is currently positioned above the Ichimoku cloud. The green Chinkou Span line is also situated above the price of 26 periods ago, emphasising the bull run.
Both the blue Kijun Sen and red Tenkan Sen lines are also above the cloud, which further supports the view that a bull run is under way.
Exactly how long this will last depends on whether the price can break through the previous maximum of $35.655.
A clear break above this could mean that it is heading for the next psychological barrier, the $44.155 level we saw in August last year.
If it fails to breach $35.655, expect a return to the cloud, however avoid short trades before we have seen at least two convincing closes below the cloud.
Good luck and happy trading
Shai Heffetz, InterTrader
(Original article written 23 February 2012).
Spread betting carries a high level of risk and you can lose more than your initial deposit, so you should ensure spread betting meets your investment objectives.
The contents of this report are for information purposes only. It is not intended as a recommendation to trade. Neither InterTrader nor CleanFinancial.com accept any responsibility for any use that may be made of the above or for the correctness or accuracy of the information provided.
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'Technical Analysis: Bullish Silver Spread Betting Market Nears Recent Highs' edited by DB, updated 23-Feb-12
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