In trading on Wednesday, shares of the iShares Silver Trust ETF (Symbol: SLV) entered into oversold territory, changing hands as low as $14.36 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of iShares Silver Trust, the RSI reading has hit 29.0 - by comparison, the RSI reading for the S&P 500 is currently 56.3. A bullish investor could look at SLV's 29.0 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), SLV's low point in its 52 week range is $14.03 per share, with $20.40 as the 52 week high point - that compares with a last trade of $14.40. iShares Silver Trust shares are currently trading down about 1.9% on the day.