Jul 102014
 
EGO stock chart

EGO Third Price Target Hit

The EGO (Eldorado Gold) Long-Term Trade idea hit the third profit target (T3) yesterday, as well as today, for a 36% gain from entry. As discussed in the mining sector video posted earlier today, the odds for a pullback in the mining stocks are quite elevated at this time and that holds true for EGO as well.

Not only are reactions off the price target levels typical in general but EGO is also coming off overbought levels (on the daily RSI) not seen since the stock peaked in Sept 2012 as highlighted on the left of this updated daily chart. I don’t expect anything remotely close to the 46% plunge in the stock that immediately followed that previous similar overbought condition, as that one had occurred during the early stages of the recent bear market in the mining sector whereas this time around, the stock is most likely in the early stages of a new bull market.

I’ve also added an very steep uptrend line on which prices current sit precariously on top of. Any solid break or daily close below that trendline would likely spark a correction which could provide another objective entry in the near future.  T5 remains the final long-term target at this time but again, the odds of at least a decent correction before EGO gets there is quite elevated at this time. Additional details on this trade, including the longer-term bullish case, can be viewed in the Gold & Silver Trade Ideas video posted on June 13th.

Click here to view the live, annotated chart of EGO.

Jul 102014
 


The first part of this video covers the both the near-term & long-term outlook for gold & the mining sector. A case is made that although the intermediate & longer-term outlook is still bullish, the mining sector is overbought while at resistance, thereby elevating the odds for a near-term pullback in the sector at this time or at the very least, careful consideration should be made before adding new exposure to the sector at this time despite the recent bullish price action. At the end of the video, we take a quick look at the charts of a few of the largest components of the GDX (gold mining ETF): GG, ABX, NEM, SLW, & FNV.

Jul 102014
 

I’ve received a few inquires as to my thoughts on the mining stocks recently and although I posted my thoughts on the sector in this post just yesterday, things move fast in the market & that holds especially true for the mining stocks when the sector is hot as it has been lately.  First off, I want to clarify or expand on yesterday’s statement that I my plan was to wait until either my pullback targets were hit OR both the metals & the miners clearly broke out of their recent trading ranges. The key word in that statement, which may be subject to various interpretations, is clearly Continue reading »

Jul 102014
 

CAS (A.M. Castle & Company) is currently backtesting the falling wedge pattern as well as horizontal support, once again offering an objective entry or add-on. Stops remain on any move below 10.80 & targets remain as previously posted (see 120 minute chart). With the broad markets sucking wind lately, this trade may very well go on to be stopped out soon. However, I just wanted to update the trade as if CAS does happen to reverse off this daily horizontal support level & the backtest of the wedge pattern, any new entry or add-on here (CAS is trading at 10.90 as I type), offers a R/R ratio of nearly 11:1 to the first target (obviously an even better R/R to the 2nd & 3rd targets). Again, this trade may very well be stopped out soon or even by the time that you read this but from a pure risk/reward perspective, aggressive traders could take a shot at a long here with minimal downside & considerable upside. Updated daily & 120 minute charts below.

Jul 092014
 

The following trade ideas have been removed from the Active Short Trades categories as they have either exceeded their previous suggested stops (or any reasonable stop, if none suggested) or the stock simply no longer looks to offer an attractive R/R at this time. Some of these trades may have already hit one or more profit targets while others did not. Most trade ideas on RSOTC are immediately removed from the Active Trades category upon reaching the final profit target while trades which are stopped out or no longer look attractive are often removed periodically in bulk. Inquires on Active Trade ideas that have not been recently updated my be requested via the Contact page, located under the Resources section of the menu at the top of the website.


ABG: Hit the first profit target on Jan 27th for a 9.7%, consolidated for a few days & began moving lower before reversing about half way to the second target, exceeding both the entry level as well as any reasonable stop.

AVGO: Hit the first target (T1) for an 8.3% gain in just 8 trading sessions before bouncing & exceeding the suggested stop level for those targeting T2.

FCH: I jumped the gun on this one, posting an entry on the slightest intraday break below the uptrend line, with prices quickly reversing that day and never looking back. i.e.- A false breakdown or pre-mature entry. I’ve re-adjusted the trendline since & have FCH on my radar for a new short entry soon as the stock is in what appears to be the terminal stages of Continue reading »

Jul 092014
 
LL Final Target Hit July 9th

LL Final Target Hit July 9th

The LL (Lumber Liquidators) short trade has hit the final target, T2 at 71.72, for a 38% from the original entry. LL was first mentioned as an aggressive entry as it was just breaking down below its 2-year primary uptrend line on the morning of November 22nd (trading around 114 at the time). I also listed a second add-on or more conservative entry on a break below the 109 support level, which the stock also went on to trigger later that same day, providing a 34.2% gain based solely on that entry level (and about 36%, if taken in tw0 equal lots at both entry points). The possibility of adding a third target target level around the 49 area was previously discussed but as I did not make it official before this 2nd & current final target was hit, I will consider T2 the final target and LL will now be moved to the Completed Trades category where all associated posts on this trade will be archived for future reference.

LL is one of many trade ideas, both long & short, that have remained in the Active Trades categories for many months now. Unlike LL, which never exceeded any suggested or reasonable stop (always trading below the original entry point since the inception of the trade), there are quite a few old trade ideas that have either exceeded their previously suggested stop criteria or any reasonable stop criteria, if none suggested. I do plan to clean up the Active Trades category this week by removing any stopped out trade or those that no longer look very attractive & I will also continue to scan for any new trade ideas offering the most attractive risk/return profiles. As always, if you have any questions or comments with any of the trade ideas or market analysis shared on RSOTC, please don’t hesitate to contact me.

Jul 092014
 

SSRI SIlver Standard Resources) has hit the final target, T3 at 9.18 (recently trading as high as 9.19 so far today) giving this trade a 42.3% gain since entry just over one month ago. Typical swing traders should consider booking full profits while longer-term traders or investors should at least raise stops if planing to hold out for additional gains.

While I remain longer-term bullish on the mining sector, this most recent trade on SSRI was based off the 60 minute time frame with T3 list as my final target as, although the stock may certainly continue to climb, the near-term R/R for typical swing traders is no longer favorable to remaining long at this time. With that being said, SSRI may be added back as another swing trade or possibly a Long-Term Trade idea in the near future should another objective entry in this silver mining stock develop in the coming days, weeks or months. Previous & updated 60 minute charts below: