A Real Money subscriber emailed me asking about my 2023 top stock pick of Hecla Mining ( HL) wondering if there were any other precious stocks on my buy list.
Alamos Gold ( AGI) fits the bill.
In this daily bar chart of AGI, below, I see that the shares made a bottom in the May to September timeframe. Trading volume was fairly active and the On-Balance-Volume (OBV) line rose even as prices dipped -- someone was an aggressive buyer of the shares. Prices started an upward trend in October and continue to trade above the rising 50-day moving average line and the positive 200-day moving average line.
The OBV line has risen the past eleven months. The Moving Average Convergence Divergence (MACD) oscillator has just turned up above the zero line for a fresh outright buy signal.
In the weekly Japanese candlestick chart of AGI, below, I see a large saucer-like base pattern. The shares dipped down to the $7.00-$6.50 area many, many times and buying interest surfaced. AGI has rallied to the 2020 highs in the $11.50 area. A move above this area will be an important upside breakout. AGI trades firmly above the rising 40-week moving average line.
The weekly OBV line shows a smooth and steady rise the past three years and confirms and supports the price advance we have seen so far. The MACD oscillator is above the zero line and poised for a fresh outright buy signal.
In this daily Point and Figure chart of AGI, below, I can see an upside price target in the $21 area.
In this second Point and Figure chart of AGI, below, I used weekly price data with a five-box reversal filter. Here the software yields a price target in the $41 area. I wonder what price spot gold will be trading at?
Bottom-line strategy: Traders could go long AGI at current levels and on strength above $12. Risk to $9.50 for now.
