Agnico Eagle Mines Ltd (AEM) – the gold diggers are running out of breath

 

Agnico Eagle Mines Limited is active as a mining company in gold production, operating gold mines in North and South America as well as in Europe. The company, with its headquarters in Toronto, is traded on the NYSE with the acronym AEM, and has recorded significant price declines in the last 6 months. In this analysis, we explore the possibility of further falling prices.

 

Current chart image of this stock

In the daily chart shown, the clear downward trend is plotted in blue. Since mid-December, the prices have recovered once again, and have pushed through the SMA200 line in the last few days. It now remains to be seen whether the prices can remain above the SMA or whether signals will form in the subordinate hourly chart, shown here in orange. As long as the high at 53 USD is not clearly broken, the stock is in a downward trend.

 

image 1 – daily chart AEM

 

In any case, with this stock, one should take the gold market into account, which we will look at in more detail now:

The associated overall market – Gold

Since AEM operates gold mines, before making an entry into the stock, it is essential to consider the gold price. Here in image 2, the price development is very similar to the chart image of our stock. When we observe the gold price more closely, it is apparent that a small upward trend has formed in the last few days. Only when this turns around, as has been drawn in, do the probabilities for our short scenario in the AEM become even higher.

 

image 2 – daily chart Gold

 

Before making an entry, one should consider the company news on the 16th February, as well as the actions of the central banks.

Parameters

Entry:
Depending on the formation of the hourly trend, between 51 USD – 45.50 USD

Stop:
Depending on the formation of the hourly trend, on the last high.

Targets:
1st target: 36 USD
2nd target: 27 USD

 

 

 

Disclosure of possible conflicts of interest:
At the time of publishing this analysis, the author is not invested in the securities or underlyings discussed.

 

Disclaimer:
Exchange transactions are associated with significant risks. Those who trade on the financial and commodity markets must familiarize themselves with these risks. Possible analyses, techniques and methods presented here are not an invitation to trade on the financial and commodity markets. They serve only for illustration, further education, and information purposes, and do not constitute investment advice or personal recommendations in any way. They are intended only to facilitate the customer’s investment decision, and do not replace the advice of an investor or specific investment advice. The customer trades completely at his or her own risk.

Agnico Eagle Mines Ltd (AEM) – the gold diggers are running out of breath
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