With the gold stocks doing so well lately, we recall those heady days of the late 1980's leading up to Black Monday in October 1987 when gold stocks were finishing up their big price runs. Stocks like Newmont Mining Corp. (NEM) and American Barrick (ABX), an upstart 1983 IPO on the Toronto Stock Exchange that listed on the NYSE in 1985, had huge price runs in the 1986 to 1987 time frame. As a recent IPO, ABX had the most notable run during that time. The weekly chart below from that period shows the price move that ABX had, and gives you some food for thought with respect to the potential of any possible move in gold stocks in 2010.
Not a bad move for ABX there in 1986-1987, but let's take a close look at that cup-with-handle base it built from August 1985 to April 1986 on a daily chart from that period, below. It's probably no surprise, that just as we might have surmised on the weekly chart, above, in our annotations, ABX did in fact flash a number of pocket pivot moves in that base, proving that the pocket pivot concept is quite valid, or at least it was back then before ABX launched out of this cup-with-handle base and went off on a seven-fold price move. In the daily chart below we are using a red 10-day moving average and a green 50-day moving average to illustrate where the pocket pivots are. There are probably a few more than we've identified in this base, so see if you can find them!
This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.