AEM Agnico Eagle update

Just a few days ago we suggested buying this stock below the market at around $33, which was roughly an equality point between two down legs over the past year or so, and the 62% Fibonacci point. (see previous blog) As it happens the stock dived down to $31.50 on horrific results and then rebounded briefly to above $37. This is and inside-outside day reversal pattern and a big one moving almost 20% in a single day and right on time to boot; here is the chart;

aem feb 18 2012

These charts do not do the move justice but they will have to do. Had you bought at $33 or below, you would have been up 10% for the day if you sold at the close. These type of days promise a little more usually. $40 is the top of a 4th wave of minor degree and $48+ is the top of wave 4 of the second downleg. Both could be reached. At the very least one should get a small a-b-c pattern, so far there is only an a, perhaps incomplete at that.

Long term ask your broker for real fundamental research, not the “we hold management in high esteem” rubbish. Veritas has just rated the stock as a sell over the longer term and they believe, according to a BNN presentation, that itself will move to about $1000. Right or wrong , who knows, but at least refreshing compared to all the Pavlov talking heads.