MicroStockProfit

Yamana Gold, Inc. (AUY) is still reeling from the beating it took from the Street and the financial press for its last Quarter/last year’s performance.  AUY missed every meaningful benchmark (revenues, cost per ton, production volumes, etc…) and those misses are compounded by the stagnant gold prices recently.  To say that AUY “missed” those benchmarks is not to say that the company is in any trouble.  It is still profitable and has a strong balance sheet, but the market is looking for AUY to continue to be a low-cost producer and for growth.

BUT (and, that is a BIG but), AUY might be a great chart play.  It is showing that it could bounce off of near-term support and deliver a short-term gain to savvy traders.

Here is the chart with my annotations:

“Is the bad news burned into the stock price” is the simple question that traders should ask themselves.  I think that it might be.  Historically, AUY has had great elasticity and bounced off of oversold levels and returned some nice gains.  If you were to do a year chart on AUY, you would see what I am talking about.

AUY could be a nice short-term trade.  Any breaks below support and the stock should be avoided until it can build a new base…or it can issue some better news.

Time might be right to take a look at NVAX again.  The stock was a 30 cent penny stock in March of this year and hit a high of $7.79 on September 1st.  Right now it is trading at almost half that number ($3.96).  THE QUESTION IS, “DOES IT HAVE ANY MORE LEGS”.  I don’t believe that it will have a 2,500% gain like it did from 30 cents to almost $8, but I think it might have a nice gain or two in it.

Several factors could make NVAX a winner again, as follows:

News - What caused NVAX to jump in the first place?  News about Swine Flu and NVAX was lumped in with all of the swine flu stocks and took off! Now that we are approaching flu season….what is to say that we won’t get a fresh set of news about the epidemic that could set NVAX off again.

The Chart - People have been so busy selling shares that they haven’t realized that they might have set NVAX for a bounce.  Be careful, here, though - the unhappy people that bought into NVAX in its rise will be selling shares into any spike in price.  That may shorten or reduce the length and severity of any spike.

Let’s look at the chart:

Volume is still strong (daily average of over 8MM shares traded).  the MACD is still bearish, but the angle of the bearishness is slackening.  The stochastics indicate that the stock is in an oversold position.  The Accum/Dist is still showing distribution.

I suggest watching the key indicators to see if NVAX declares its intentions.  It may go down for a day or two more, but watch for the bounce.  Definitely put this one on your trading radar.

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