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Chart in Focus: Technical Indicators of Mining Stocks

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Dec. 14 2017, Published 2:36 p.m. ET

Mining stock analysis

In the final 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) metrics for Gold Fields (GFI), Wheaton Precious Metals (SLW), Pan American Silver (PAAS), and IamGold (IAG).

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Volatility analysis

Gold Fields, Wheaton Precious Metals, Pan American Silver, and IamGold have call-implied volatilities of 37.3%, 30.8%, 29.2%, and 40.4%, respectively. The call-implied volatility measures the changes in an asset’s price given the changes in the call option.

Gold Fields and IamGold reported 30-day trailing losses of 0.26% and 4.5%, respectively. Wheaton Precious Metals and Pan American Silver reported 30-day trailing gains of 6.9% and 3.6%, respectively.

RSI readings

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

Gold Fields, Wheaton Precious Metals, Pan American Silver, and IamGold have RSI scores of 36.7, 55.2, 41.9, and 44.4, respectively.

The Physical Swiss Gold Shares ETF (SGOL) and the Physical Silver Shares ETF (SIVR) rose 0.88% and 2.1%, respectively, on December 13, 2017, after the Federal Reserve increased interest rates by a quarter point. SGOL and SIVR posted 30-day trailing losses of 1.9% and 2.4%, respectively.

Precious metals and miners reported a negative trend in the last one-month period, as the market widely expected interest rates to rise.

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