Technicals for Mining Shares and How They’re Moving



Mining shares

Precious metals, especially gold, reported good returns for 2017. However, the year was a roller coaster ride due to global and political unrest. Most miners fell in 2017 since they take price directions mostly from the precious metal market performance and the overall equity markets. 

For our analysis, we’ve selected Royal Gold (RGLD), Goldcorp (GG), Alamos Gold (AGI), and Agnico-Eagle Mines (AEM). Except for Alamos Gold, which has fallen 0.63% on a 30-day trailing basis, RGLD, GG, and AEM have risen on a 30-day trailing basis by 0.87%, 13.1%, and 9.1%, respectively.

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Volatility analysis

The volatility analysis reads the call implied volatility of miners. It measures the price changes in the price of an asset with respect to the changes in the price of its call option. RGLD, GG, AGI, and AEM have call-implied volatilities of 24.7%, 25.7%, 46%, and 26%, respectively. 

RSI levels

When a stock’s RSI (relative strength index) level is higher than 70, it indicates that it could be overbought and could fall. When a stock’s RSI indicator is lower than 30, it suggests that the stock could be oversold, and its price could potentially rise. RGLD, GG, AGI, and AEM have RSI levels of 47.5, 91.4, 53.9, and 81.5, respectively.

Our two vital mining-based funds, the VanEck Vectors Gold Miners ETF (GDX) and the Sprott Gold Miners ETF (SGDM), have 30-day trailing losses of 3% and 2.4%, respectively. 


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