Gold is in a bull market, no doubt about that. It is experiencing its Level 2 of the market cycle. To know more about gold, see my yesterday’s article which is a view on the price of gold in both the short and long term. This post is focused specifically on three stock picks of gold miners who do better than the others on the stock market and whose price will likely soar as soon as the breakout happens.
Before we jump on the individual companies, let’s see how the most-watched Vaneck Gold Miners ETF looks like in the long-term. GDX has broken its long-term resistance in May and successfully re-tested the support level. Since then the ETF is rising. Currently, the price is in consolidation – the short-term support is the 20 EMA (blue line). The next resistance from a long-term perspective is around 55 (green line). Thus, as you can see, there is still plenty of room before a huge profit taking will take place. The ETF is covering many gold miners reflecting the best picture of the industry and its trend.
Kinross Gold Corp. (KGC)
- Market Cap: 11.65B
- P/E: 12.88
- PEG: 0.65
- EPS Q/Q: 172.10%
- Operating Margin: 33.10%
KGC has outstanding fundamentals as you can see above. The technical overview provides clear buy signals. The orange lines are depicting an end of short-term consolidation. This was always followed by a bull run of the stock, taking the price higher. Currently, something similar is happening, which is also supported by RSI, MACD, Slow Stochastic, and Bollinger Band Width. See the green circles. As soon as the price breaks above 10, this would be the BUY signal.
Barrick Gold Corp.
- Market Cap: 54.84B
- P/E: 12.17
- PEG: 0.43
- EPS Q/Q: 81.30%
- Operating Margin: 71.60%
Barrick Gold is one of two biggest gold miners in the world. Its current support level was re-tested and the stock is attempting to break through the resistance – price approx 31. Once pierced through up, the stock will likely slide the 20 period EMA upwards. Watch the breakout to go LONG.
Agnico Eagle Mines Limited
- Market Cap: 20.46B
- P/E: 40.61
- PEG: 0.76
- EPS Q/Q: 272.60%
- Operating Margin: 32.40%
Another Canadian gold miner Agnico Eagle Mines has in fact quite a high P/E ratio, but the fact the EPS growth was outstanding, it surely appeared on my radar and deserves attention. The price has formed a flag pattern in current consolidation and today it is trying to complete. I don’t think the breakout is going to happen today, but as you see the market participants are trying hard to do so. Watch a price level of 84, as soon as this holds above, the stock will be poised to surge again.
It is certainly worth to watch these three stocks’ behavior in current market environment. Stay disciplined and focused on big picture!
