Analyzing Miners’ Volatilities and RSI Levels


Sep. 13 2017, Updated 7:39 a.m. ET

Technical analysis

Price fluctuations in precious metals are often closely tracked by mining stocks. Before investors opt for mining stocks, there are a few technical indicators they should evaluate.

In this part of the series, we’ll look at volatility figures and RSI (relative strength index) scores for major miners Silver Wheaton (SLW), Barrick Gold (ABX), Agnico-Eagle Mines (AEM), and Buenaventura Mining (BVN).

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Call-implied volatility

Call-implied volatility is a measurement of the variations in a stock’s call option price. On September 8, 2017, Silver Wheaton, Barrick Gold, Agnico-Eagle Mines, and Buenaventura Mining had volatilities of 30.8%, 28.1%, 29.6%, and 33.2%, respectively. Mining stocks are often more volatile than precious metals.

RSI levels

A stock’s RSI level indicates if it has been overbought or oversold. If a stock’s RSI score is above 70, it may be overbought, and its price may decline. If a stock’s RSI score is below 30, it could be oversold and might correct upward.

The RSI scores for the miners mentioned above have recuperated recently. Silver Wheaton, Barrick Gold, Agnico-Eagle Mines, and Buenaventura Mining have RSI scores of 74.0, 73.1, 76.1, and 79.5, respectively.

The VanEck Vectors Junior Gold Miners ETF (GDXJ) and the Sprott Gold Miners ETF (SGDM) also follow changes in precious metal prices. These funds fell ~1.9% and ~1.3%, respectively, on Friday, September 8, 2017.


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