Lou,
Can you give us your analysis of Gold Wheaton?
Thanks, Robbie.
Hi Robbie,
Gold Wheaton Gold Corp. recently consolidated their shares and warrants on a 10 for one basis and has seen their shares graduate to the TSX from the Venture Exchange. The three year chart tells the tale of building a base to make a case for an investment.
The stock has been building a base along support at $2.00 since late 2008. The old saw on the street is that the bigger the base, the better the case for an upside. At this point in time there is resistance along the 200 day moving average and the 50 day moving average is turning lower which suggests that GLW could be retreating to support at $2.00.
The six-month chart provides a closer view of the short term trading action in the stock and the resistance along the 200 day moving average and at $2.85. The RSI signaled an oversold situation in early February and the buying that came in to lift GLW to $2.85.
At this point it appears that GLW is trading in a range between support at $2.00 and resistance at $2.80.
Gold Wheaton doesn't actually operate mines but like Silver Wheaton buys production from existing miners. Another factor to consider is the strength in the boardroom. Frank Giustra is a director and his reputation speaks for itself.
According to seasonality expert Brooke Thackray the period of seasonal strength for gold is mid July through the beginning of October suggesting that you could be well served to put GLW on your watch list in anticipation of a move later in the year.
The strong base with support at $2.00 plus the quality of management and the pending period of seasonal strength makes GLW one that you may want to trade in its range for income and watch for a breakout in mid July.
Happy Capitalism!
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Lou Schizas