Friday, November 6, 2009

Is Barrick Going to Break Out?

Let me say this up front forcefully: Barrick Gold Corporation (ticker: ABX) is a crappy company and you should not invest in them. Period. I don't trade it and I don't like this company. If you're not into the Gold sector, it's a long story and I'll just leave it at that.

However, if Barrick can move higher and hold its current intra-day break out from it's recent trading range, it means the big boyz are really piling into the Gold stock trade. Most long-term Gold stock bulls avoid this stock completely, but the paperbugs love it as one of their "blue chippers" in the Gold sector.

Here's an 18 month daily linear plot of Barrick (ABX):

Royal Gold (ticker: RGLD and see my old rant about the long-term prospects for this stock here) is at the threshold of a break out as well (disclosure: I am a stubborn bull on this stock and own long term calls on it despite the fact that I have been disappointed with its recent performance). Here's an 18 month daily linear plot chart on RGLD:

If Barrick and Royal Gold breakout here and now to the upside, it should be off to the races (day to day swings aside) in the Gold sector. I, for one, wouldn't bet against these two stocks breaking out but Mr. Market will let us know very soon one way or the other.

Wikinvest Wire