Friday, January 12, 2007

Silver Seasonal



One of the tools I like to use in my trading is seasonality. I think seasonality is misunderstood by many traders. The way I like to use seasonals is to COMBINE it with other tools to improve timing and accuracy.

Long before the internet became popular, I was receiving my seasonal charts in the mail from a company called Moore Research Center,Inc.
In my opinion they have the best seasonal charts and do the best research on seasonal tendencies. I highly recommend their work. The above chart is courtesy of Moore Research Center,Inc.

The above chart is the 15 year seasonal tendency for silver. As you can see in the yellow highlighted area, Silver tends to rally during the month of January going into February. This appears to be a good time to be bullish on silver and even gold

Now just because there is a seasonal tendency to rally doesn't mean you just buy and hope the seasonal strength repeats this year. I like to combine it with other tools to help improve the accuracy. If you scroll down below you will see my other reason for being bullish on silver now.

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