Averages on the verge of a medium-term technical buy signal
The share price of Canadian gold explorer Element79 Gold (WKN A3EX7N / CSE ELEM) has continued the positive development last discussed in our chart check on February, 7. In the six-month chart, the share price started its upward movement at the November low and has been moving north above the blue trend line ever since.
The move in early February took the price above both average lines. In the subsequent consolidation phase, the price fortunately managed to remain above the 200-day line – with one brief exception. Currently, the blue trend line, both averages and several gray lines (derived from the highs and lows of recent months) provide support.
Consolidation above the 200-day average
The 200-day line continues to fall, although the pace is slowing somewhat. On the positive side, the 100-day line is clearly rising and – this would be a medium-term technical buy signal – is on the verge of crossing the 200-day line upwards.
The MACD indicator has been on the sell side since the beginning of April, whereas the stochastic indicator generated a technical buy signal again a few days ago (the blue line crosses the red line upwards). The trend confirmator has been hovering at the neutral 100 for weeks, but turned slightly downwards into the negative zone a few days ago.
The two turnover-weighted indicators suggest that a price increase is possible in the near future. The Chaikin Money Flow is currently rapidly leaving the red terrain, which indicates an outflow of capital, and is almost back in the green. The Money Flow Index (sales-weighted relative strength RSI) is at a six-month low – the two previous times this was followed by a price rise.
Source: Comdirect
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