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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