Last night, we provided a detailed look at the fundamentals of Trueclaim Exploration (TRM, TSX-V) through an interview with the company President.Ā This morning we examine the technical health of the stock, and John has a bullish analysis.Ā As of 11:30 am Pacific, TRM is trading a penny-and-a-half higher at 20 cents on CDNX volume of 277,000 shares.
John: Yesterday, Trueclaim Exploration (TRM, TSX-V) opened at 19 cents, dropped to a low of 18 cents, rose to a high of 19.5 cents and then closed at 18.5 cents for a loss of half a penny on the day on CDNX volume of 467,000 shares.
Looking at the 6-month daily chart we see that on September 17, Trueclaim broke above resistance at 12 cents and in 2 weeks climbed to 17 cents.Ā From there it traded in a horizontal trend channel between 15 cents and 17 cents (top blue line, bottom green line) untilĀ December 3 when there was a breakout to the upside on very high volume. This volume was repeated on December 4 and the price reached 22 cents. Ā In 2 days it retraced to 18 cents (Fibonacci 38.2%) only to climb again and reach a high of 23.5 cents on Dec. 14.Ā From there it retraced down to a low of 16 cents before trading within a horizontal trend channel between Jan. 21 and now.
During the last 9 sessions (entering today) there has been increased trading activity which is always bullish when the price is near the breakout level. The main resistance levelsĀ to a move to the upside are at 19 cents, 20 cents and 22 cents (blue horizontal lines). There is strong support at 17 cents (horizontal green line). The black Fibonacci set has a seed wave between 15 cents and 23 cents and shows the first target to be 28 cents (we caution that this is not a BMR price target as we donāt give price targets but a potential andĀ theoretical Fibonacci level based on technical analysis).
Looking at the indicators:
The RSI is flat at 53% (plenty of room to higher) which is to be expected when the price is in a horizontal trend channel.
The Slow Stochastics (SS) has formed a bullish “W” in the last 2 weeks with the %K (black line) at 67%, pointing up and above the %D (red line) at 56% which is also pointing up – bullish.
The Chaikin Money Flow(CMF) shows that the recent selling pressure has abated and now sits at the -0.049 level – bullish.
Outlook: With the price near the top of the channel, increased volume and bullish signals from the indicators, TRM looks poised for a breakout in the near future.
Note: The writer does not hold a position in Trueclaim.
John
if you nail this chart just like AGE this should be breaking out very soon, thanks for the chart updates, I look more forward to them now than the comments, well almost.
Thx greg
Comment by GREG H — March 2, 2011 @ 11:45 am
Greg
Thank you for the compliment…..I think!!!!
LOL
John
Comment by John - BMR — March 2, 2011 @ 3:00 pm
Is TRM in BMR’s portfolio now,anyone know?
Comment by dave — March 3, 2011 @ 4:35 am
Hi Dave, we like TRM a lot but it’s not part of our “model” portfolio, at least not yet. All the companies in that category (10 in total at the moment) are covered every weekend in our Week In Review…….
Comment by BMR — March 3, 2011 @ 6:59 am
Hi John,
My question is about Abcourt Mines. What are the next milestones the company hopes to achieve before mine starts in 18-24 months? Do u think the sp will stay flat until then?
Comment by Richie — March 3, 2011 @ 7:34 am
Hi Richie, Abcourt’s #1 priority at the moment is upgrading and increasing reserves at the Elder-Tagami Project near Rouyn-Noranda which they are definitely in the process of doing given the results that have been coming in from there. I visited the property in January – Elder is a former producer (underground operation), considerable infrastructure is already in place to re-start production (though more money will be required). A major drill program continues (10,000 metres). I’ve spoken with geologists not connected with Abcourt who are very bullish on this project. The company’s goal is to put this thing into production at the rate of about 30,000 ounces per year by the end of 2012. But they may have even more Gold there than they think. Of course they’re also drilling the Abcourt-Barvue Silver-Zinc Property which is also a former producer and one of the best silver assets in the country. Very good results from that drill program so far. So this is a company sitting on some impressive assets that really should have a higher valuation. Somehow, the current management has to unlock the value here —– if they don’t, and we see precious metal prices continue to rise, and zinc moving higher, I wouldn’t be surprised if a company were to swoop in and launch a takeover attempt.
Comment by Jon - BMR — March 3, 2011 @ 9:37 am