CLGRF CRJ.TO Claude Resources – Gold Miner Bullish Bottoming Reversal Pattern

by Olivier on November 25, 2014

The two gold miners I like best right now are RIC – Richmont Mines and CLGRF / CJR.TO Claude Resources. CLGRF has put in a bottoming formation that looks similar to RIC.

Keep this in mind: The chart has put in a series of higher lows and is not attempting to put in a V-bottom like most other miners. The key difference here is that a series of higher lows means that the recent sell-off low has already been successfully tested. With a V-bottom type of pattern the risk is twofold:

  • The lows might need to be retested
  • Overhead resistance is typically a bigger problem as there is less overall pattern pressure to propel prices higher

Click on CLGRF daily chart to enlarge:

Click on CLGRF weekly chart to enlarge:

The weekly chart analysis suggests a very conservative price target around 0.37 is most likely. A more optimistic target in the 0.50 – 0.60 price area doesn’t seem unrealistic though.

Claude Resources’ company profile is somewhat similar to RIC:

  • It is operating in Canada, a safe jurisdiction
  • Very low debt
  • CJR.TO is a profitable gold producer
  • The stock bottomed out much earlier than its peers
  • A new CEO recently took over

Price trumps narratives.


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