Why did we add Barrick Gold Corp (ABX) into strength after it was up 3% from today's spike low at 44.76? Because the sharp intraday recovery rally occurred after what looks to me like the completion of a significant correction off of the 47.55 high from 9/22.

If my pattern work proves correct, then today's low should not be violated prior to ABX breaking out to the upside above key multi-month resistance between 47.55 and 48.02. Let's notice on the enclosed weekly chart that ABX has carved out a series of rallies since January that have stalled around the 47.50 area, which have been followed by pullbacks to higher-corrective lows. Successive higher-lows followed by rallies to 47.50 are putting increasingly intensive pressure on the horizontal or flat top, which should be hurdled and will trigger an optimal target of 55.80-56.30 in the subsequent days and weeks.

At this juncture, only a violation of today's low at 44.76 will compromise the above-described bullish technical set-up.

By Mike Paulenoff

Mike Paulenoff is author of MPTrader.com (www.mptrader.com), a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies, Treasuries, and specific industries and international regions.

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