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Important Technical Indicators for Mining Stocks

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Nov. 17 2017, Updated 2:51 p.m. ET

Technical indicators

We’ll look at a few technical readings for mining stocks, including their RSI (relative strength index) levels and call-implied volatilities.

Call-implied volatility measures tools used to price changes in a stock with respect to changes in a stock’s call option. RSI reads whether a stock is overbought or oversold. Levels above 70 suggest that the stock is overbought while levels below 30 indicate that a stock is oversold.

The Sprott Gold Miners ETF (SGDM) and the leveraged Direxion Daily Gold Miners fund (NUGT) saw lower prices of 0.2% and 0.62%, respectively, on November 16. 

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Volatility and RSI levels

On November 16, mining stocks B2Gold (BTG), Agnico-Eagle Mines (AEM), Barrick Gold (ABX), and IamGold (IAG) had implied volatility readings of 54.8%, 33.6%, 29.1%, and 44.3%, respectively. BTG, AEM, ABX, and IAG have RSI scores of 66.7, 42, 17.2, and 57.3, respectively.

During the past 30 trading days, most mining stocks’ prices have fallen. AEM, ABX, and IAG have 30-day trailing losses of 2%, 14.3%, and 3.7%. Among these four miners, only BTG has a 30-day trailing gain of 1.9%. 

The past month has also been adverse for most mining stocks. The US dollar had been rising, and news of a possible interest rate hike caught investors’ attention. Precious metals, however, managed marginal gains.

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