Buy silver for short-term trade, advises the MACD watched by this technical analyst...
IT'S TIME to buy silver again, writes Jeff Clark at Growth Stock Wire, part of Porter Stansberry's research group.
We last bought the metal back in January at about $19.70 per ounce. We rode the rally all the way up to $22 before stopping out last month at $20.35. Overall, we earned about 3.4% in less than two months.
And now that silver has pulled back to the price we bought it in January, it's time to buy again.
You see, silver is one of those trades where the upside potential is so large, I'm uncomfortable being out of it for too long. And we just got a "buy" signal from one silver timing indicator...
The Moving Average Convergence Divergence (MACD) momentum indicator is often used for determining overbought and oversold conditions. But it can be a timing indicator, too.
Without getting too complicated, when the black 12-day MACD line crosses above the red 26-day MACD line, we have a "buy" signal. When the black line crosses below the red line, we have a "sell" signal.
The blue circles on the chart show the "buy" signals over the past year, while the red circles show the "sell" signals.
Every trade using these signals over the past year has been profitable. If you only bought silver when the chart had "buy" signals and sold on the "sell" signals, you could have generated profits even as the metal lost 20% of its value over the past year.
And as you can see from the chart, we just got another "buy" signal from the MACD indicator. So I believe it's time to buy silver again.