I received a price alert on AXU (Alexco Resource Group). This mining stock has taken out dual-resistance levels today; both the downtrend line as well as the horizontal resistance at 0.45 and looks to provide an objective long entry here. I do have my concerns about this breakout sticking as I made the case for a likely pullback in the mining sector in the previous post earlier today. With that being said, the charts look bullish so I’m going to add AXU as an Active Long Trade idea here at 0.46 with a suggested stop below 0.40 and a sole price target at this time of 0.63 (actual resistance is 0.68).
AXU is a thinly traded penny stock and should be considered a very aggressive trade. Consider a substantial downward beta-adjustment to your position size, assuming that this aggressive trade is even suitable based on your risk-tolerance & trading style to begin with.
Although I have my concerns about a possible near-term pullback in the miners, I remain longer-term bullish on the sector. My plan with AXU (I was already long a small position coming into today & just added to the position) is to book partial or full profits around 0.63, then reposition either on a pullback off the 0.69 resistance level OR on a solid break above it, preferably after a consolidation or pullback off the T1 area, assuming that the trade pans out.