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4 Mining Stocks to Pass On

Stay away from gold on the long side this week


My Power Stocks System tracks the most volatile, liquid candidates for option trading or short-term stock trading each week…but along with those strong names, I uncover the duds of the stock market too. My quantitative system is signaling continued weakness in these stocks for the week ahead.

However, that’s not to say you can’t play put options on these names. I’ll leave it up to you to decide which strike price and month are appropriate for your trading style, but be sure to give yourself enough time to be right. I’ve also included the support and volatility levels my scanner has detected for these stocks. Average volatility in my system is considered to be 20.

  • ASA Gold and Precious Metals (ASA) has very high volatility at 41. Currently trading at $12.70, it’s  already 10% below its resistance level.
  • Goldcorp (GG), along with the other gold stocks profiled here, is showing that gold is just not the place to be in the short-term. Currently trading at $24.73, GG has a resistance level at $28 and extremely high volatility at 48.
  • SPDR Gold Trust (GLD) closed Friday at $119.15, well below its  $134 resistance level. Its volatility is rated 29, which seems tame in comparison to other names in the sector, but could still contribute to a steep drop.
  • Barrick Gold (ABX) has the highest volatility of them all at 72. It is currently 20% below its resistance level of $19, with a Friday close of $15.74.

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