John: Yesterday, Adventure Gold (AGE, TSX-V) opened at 47 cents, drifted down to 46 cents and then closed at its high of 51 cents. It gained 3 pennies (7.37%) on CDNX volume of 158,000 shares. As of 7:30 am Pacific, Adventure Gold is unchanged at 51 cents on volume of 68,500 shares. Something appears to be brewing here as this chart has turned quite bullish over the last three weeks.
Looking at the 4-month daily chart, we see that for the latter half of January AGE traded in a horizontal trend channel to consolidate and form a base for another move to the upside. On Jan. 28 it broke out to the upside of the channel and also the EMA(20). AGE has continued to trade above this close supporting moving average.
The close at 51 cents yesterday, and the current price this morning, is at a resistance level (blue horizontal line). The Fibonacci set (blue) shows the next immediate target to be at the 63 cent level. The previous weekly chart (February 5) shows the following target to be at 75 cents (these are not BMR price targets as we don’t give price targets but a theoretical Fibonacci level based on technical analysis). The volume is relatively low and must increase if AGE is to make a major move to the upside.
Looking at the indicators:
The RSI at 58% has formed a bullish”W” formation and has been above its EMA(20) since Jan. 28 (vertical orange line) – very bullish.
The Chaikin Money Flow (CMF) indicator is at a very bullish level of 0.387 and above its EMA(20) which is pointing up. The buying power began on Jan. 18 when it broke above its moving average and has continued above it since then. This indicates consistent and increasing buying pressure.
The ADX trend indicator on this daily chart is low and the trend is weak with the +DI (green line) at 20 and above the -DI (red line) at 15. The ADX trend strength (black line) is flat at 17. The weekly chart on Feb. 5 shows the primary trend is very strong. This is a bullish orientation and the trend indicators have room to move up without becoming unstable.
Outlook: The chart and the indicators show that AGE is poised to attempt to break above resistance very soon with potential for a powerful new advance.
Note: The writer holds a position in Adventure Gold.
Hi John, I don t know if you still follow RA.V but lebed.biz just gave it a glowing review, “the most undervalued rare earth,etc…” – I think that explains the big jump today!
Comment by dave — February 11, 2011 @ 11:37 am
Thanks, Dave. You’ve pointed out a good opportunity I think. I’m not a rare earth specialist but we’ve liked RA for a while along with GWG and RUU.
Comment by Jon - BMR — February 13, 2011 @ 7:14 pm