Tuesday, 29 January 2008

New Silver Setup: Still Long

At first, the numbers looked impossible. But more checking showed they're not. With the help of reader Dave, a computer programming whiz and fellow COTs enthusiast, I'm pleased to report the results of an astonishing new trading setup for silver based on the Commitments of Traders data that's issued by the Commodity Futures Trading Commission. These blessed folks release free weekly data on trading positions in 100-odd markets, which I found a way to trade off. The results for the new silver setup are on my Latest Signals page. The setup trades on the same side as the "smart money" commercial traders when they hit specific points of bullishness and bearishness in their futures and options net position as a percentage of the total open interest. The setup, which achieved a 99.99998-percent confidence interval for profitability on a Student's t-test, has been long since May 2007. (Disclosure: I've been long iShares Silver Trust, symbol SLV, since my previous silver setup flipped to bullish last summer.)

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