Mining Stock About to Dig Itself Into a Much Deeper Hole

by Sam Collins | April 4, 2013 1:17 am

Newmont Mining Corp. (NYSE:NEM[1]) — This is one of the largest gold and copper producers in the world. Longer term, a rise in the price of gold should add to earnings; however, in the short term, precious metals are in a bear market.

We put NEM on our list of Stocks to Sell for April[2] after a recent recovery rally from its March low of $38.50 stalled and reversed from its 50-day moving average, now at $42.10. On Wednesday, it broke near-term support, hitting a new low. This failure to hold at the minor support line at $38.55 supports further selling and short selling of the stock.

The downside target is $33. A stop-loss order should be entered at $42. Short-selling is a speculative technique that is not appropriate for all investors. Check with your broker for the ability to borrow shares and any special margin or regulatory requirements that may be in force.

NEM Chart
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Trade of the Day Chart Key[3]

  1. NEM:
  2. Stocks to Sell for April:
  3. [Image]:

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