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Analyzing Miners’ Volatility Indicators

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Mining stock analysis

In this part of our series, we’ll look at the technical indicators for mining stocks. We’ll discuss the call-implied volatility and RSI (relative strength index) indicators for First Majestic Silver (AG), B2Gold (BTG), Royal Gold (RGLD), and New Gold (NGD)

Call-implied volatility reads price changes in a stock price, given fluctuations in its call option. RSI shows whether a stock is underbought or overbought

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Volatility

First Majestic Silver, B2Gold, Royal Gold, and New Gold have call-implied volatilities of 42.9%, 54.8%, 22%, and 52.4%, respectively. The volatility in mining stocks is often higher than the volatility in precious metals.

Most of the miners have seen falling prices over the past 30 trading days.

RSI

If a stock’s RSI score is above 70, it might be overbought, and the price could fall. If a stock’s RSI level is below 30, it might be oversold, and its price could rise.

First Majestic Silver, B2Gold, Royal Gold, and New Gold have RSI scores of 45, 48.5, 32, and 36.5, respectively.

The Sprott Gold Miners (SGDM) and the VanEck Vectors Junior Gold Miners (GDXJ) have five-day trailing losses of 4.3% and 4%, respectively.

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