Gold Bullion Development (GBB, TSX-V) continues to shine and reached another new all-time high yesterday of 59 cents on very strong volume. John updates the near-term technical outlook for GBB in the chart and analysis below:
John: Gold Bullion Development continued its steady climb yesterday, closing at 57 cents for a 3-cent gain after reaching an all-time high of 59 cents on total volume of 2.5 million shares. This company continues to attract investors in ever-increasing numbers with its potential for developing a world class open-pit, bulk tonnage gold deposit.
The 6-month daily chart shows that GBB has been climbing in an upsloping fashion since the beginning of March. It has moved from a low of 41 cents June 3 to a high yesterday of 59 cents – an increase of 18 cents or 44% in just 8 trading days. That is remarkable.
On the chart I have shown the next Fibonacci target level to be 62 cents. This does not mean the stock price will stop at this value but it is expected to at least pause at this natural level of resistance.
We also see this climb is taking the share price close to the resistance of the top line of the channel.
Looking at the indicators, we see the RSI is well into the overbought region but it still has room to move up (i.e., above 90%).
The ADX trend indicator shows the ADX trend strength (black line) is climbing, indicating the existing trend is getting stronger. The trend is bullish of course because the +DI (green line) is above the -DI (red line). Additional strength is shown by the +DI climbing and the -DI falling.
One point to keep in mind is that when the trend starts to weaken as the share price hits resistance, you will see the +DI peak and start to reverse before the ADX line weakens.
The Chaikin Money Flow (CMF) Histogram indicator is well above the zero line which shows the buying pressure is continuing.
Outlook: The chart and indicators show that GBB will probably continue its upward climb in the near future but could encounter resistance starting around 62 cents.
