Bullish on Barrick Gold
Commodities / Gold and Silver 2011 Jan 21, 2011 - 05:59 PM GMTBy: Mike_Paulenoff
The weakness in Barrick Gold Corporation (ABX) from its Dec high at 55.72 to yesterday's low at 45.75 (-18%) has returned the price structure to a critical convergent support area around 46.00-45.50. This represents the sharply rising 200 DMA, as well as the extension of the trendline across a series of 2009 and 2010 peaks (now serving as support) that cut across the price axis in the vicinity of 46.00-47.00.
The combination of a key intermediate-term support area and the downleg pattern from 55.72 to 45.75, which exhibits corrective form, compel me to hold a long position in ABX for our model portfolio. Only a sustained breach of 45.80/40 will argue that the otherwise still-intact multi-year uptrend remains viable.
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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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