Although American Pacific Mining Corp. (USGD:CSE; USGDF:OTC) hasn't advanced much on a net basis since it was recommended on the site a few weeks back, its technical condition has strengthened considerably, as we can see on its latest charts.
On the 3-month chart, selected to show recent action in detail, we can see that right after we bought it rose sharply for a couple of days on heavy volume, punching clear above its falling 50-day moving average, which was very bullish behavior. Since then it has reacted back on much lighter volume, which is quite normal, and then has steadied, which has put it in position to commence another upleg.
The key point to note here is that although this first upwave did not achieve much price-wise, it has resulted in a marked strengthening of the technical condition of the stock, which has laid the foundation for bigger gains later. Look at this way—you don't bring a train to a stop and get it moving in the opposite direction at the same speed all at once. It normally takes time and buying power to bring a prevailing downtrend to a halt and reverse it. This is why the first upwave is classed as a preliminary breakout. The second upwave, which looks imminent, will be the true breakout, which should see the stock vault well above the October high and advance away from its 50-day moving average, which will then turn up.
We'll put recent action into context by zooming out to look at the 8-month chart, where we immediately see that this stock is still very cheap, as it got as high as $0.31 as recently as last May, which is almost four times the current price. So there is a lot of "blue sky" above, which it should find it a lot easier to rise through because the entire sector looks set to take off higher as the dollar goes into reverse.
What all this means is that American Pacific Mining is even more attractive than it was when we went for it a few weeks back, and it is rated an immediate strong speculative buy.
American Pacific Mining website.
American Pacific Mining Corp. closed at $0.085, CA$0.105, on Nov. 2, 2018.
Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years' experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.
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1) Clive Maund: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. CliveMaund.com disclosures below. I determined which companies would be included in this article based on my research and understanding of the sector.
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Charts provided by the author.
CliveMaund.com Disclosure:
The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
