In trading on Thursday, shares of the ETFS Physical Silver Shares ETF (AMEX: SIVR) entered into oversold territory, changing hands as low as $19.62 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 ETFS Physical Silver Shares, the RSI reading has hit 25.2 — by comparison, the RSI reading for the S&P 500 is currently 44.2.
A bullish investor could look at SIVR's 25.2 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), SIVR's low point in its 52 week range is $19.62 per share, with $34.85 as the 52 week high point — that compares with a last trade of $19.71. ETFS Physical Silver Shares shares are currently trading off about 6.3% on the day.