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Directional Trends in Mining Stocks

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Mining stocks

We should also analyze mining stocks’ price movements in relation to their moving averages. In this part, we’ll discuss First Majestic Silver (AG), Sibanye Gold (SBGL), Randgold Resources (GOLD), and Barrick Gold (ABX).

Among these four miners, First Majestic and Barrick Gold have a YTD (year-to-date) loss of 12.7% and 11.3%, respectively. Sibanye Gold and Randgold Resources have a YTD gain 20.7% and 27.1%. The VanEck Vectors Junior Gold Miners Fund (GDXJ) has a YTD gain of 2.4%.

Most of the mining stocks fell on Tuesday—only a few rose. Among the four miners that we’re discussing, Randgold Resources fell 0.17% and GDXJ fell 0.70% on the same day.

Moving average readings

Among the four miners that we’re discussing, First Majestic is trading below its 20 and 100-day moving. Sibanye Gold and Randgold Resources are trading above their 100-day and 20-day moving average. A reasonable discount below the 20-day and 100-day moving averages indicate a potential revival in the prices, while a premium indicates a likely fall.

The selected miners’ target prices are considerably higher than their current trading prices, which indicates that there could be a rise in stock prices.

RSI indicator

Majestic Silver, Sibanye Gold, Randgold Resources, and Barrick Gold have their RSI (relative strength index) levels at 46.6, 54.1, 87, and 57.1, respectively. An RSI level below 30 indicates a potential upward movement in prices, while an RSI higher than 70 shows a possible downturn in prices. GDXJ’s RSI level is 47.6.

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