charts courtesy of stockcharts.com
On December 5, I did a post on my favourite gold stocks AEM and GG, and pointed the oversold level of the 60-minute chart and discussed the possibility of AEM reaching mid 40 price range. Well it is one week later and AEM has risen from 27 to 39. Not bad for a week’s work.
Readers who have been with us for sometime know that I like AEM because it moves fast and waves rather well.
I am not going to get into daily and weekly waves, nothing has changed there since the post of December 5.
Just a quick note on the shorter time frames
This is a 60-minute chart
It is just hitting against some resistance levels, and it is overbought on this frame. Chances of a pullback are very high. However, since everybody and their cousins can look at the same chart as us, I would not be surprised if some shrewd market makers try to push the stock through resistance to squeeze some juice out of technical shorts and program traders. I should remember that this is a stock which many institutions play when they move in and out of the sector.
This is a 15-minute chart
I can count it differently to force 5 waves complete, but I think this is more probable. If we take the view of this being a minor wave a, we may pullback very soon. If we take the view that the rise from today’s opening gap down is a minute wave 5, then we will pull back soon. If we take the view that the rise from today’s gap down is micro wave 1 of minute wave 5, then AEM should carry higher.
I should note that on the way up, AEM has made three gaps, the third was violently filled at today’s open. It is getting extended short term. Also, I am still of the view that the entire move from October bottom is corrective.
I would also like to point out that AEM is now in a confirmed uptrend. And, we should remember that next Friday is option expiration day, and gold stocks, especially AEM, may exhibit some wild behavior sometime next week.
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