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Volatility Readings and RSI Levels for Mining Shares

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Nov. 29 2017, Updated 9:05 a.m. ET

Miners’ performance

When investors look forward to investing in mining shares, it is critical that they look at a few technical details of these shares. In this article, we have selected four miners for a comparative study, and we’ll focus on their RSI readings and implied volatility.

We’ll analyze B2Gold (BTG), Barrick Gold (ABX), AngloGold Ashanti (AU), and IamGold (IAG).

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Call-implied volatility

The call-implied volatility is used to measure the price fluctuations of a stock’s price concerning changes in the stock’s call option. On November 22, 2017, B2Gold, Barrick Gold, AngloGold, and IamGold had call-implied volatilities of 54.8%, 29.1%, 40.9%, and 44.3%, respectively.

Mining stocks are often volatile and are known to follow the price trends in precious metals. However, that is not always the case.

RSI levels

RSI levels are used to assess whether a stock is overvalued or undervalued. If a stock’s RSI score is higher than 70, it might be overbought, and its price could fall. If a stock’s RSI level is below 30, it could be oversold, and its price could rise. ABX and IAG have 30-day trailing losses, while BTG and AU have 30-day trailing gains.

BTG, ABX, AU, and IAG have RSI scores of 63.6, 51.8, 72.3, and 50.8, respectively.

On a year-to-date basis, the VanEck Vectors Junior Gold Miners ETF (GDXJ) and the SPDR S&P Metals and Mining ETF (XME) rose 2.9% and 3.7%, respectively.

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