Pan American – Breakout!

Posted by Brent Woyat, CIM, CMT, Portfolio Manager

Share on Facebook

Tweet on Twitter

In our past few comments we highlighted some gold stocks that appeared to be forming major long term bottoms. Today we want to highlight a silver stock called Pan American Silver (PAA.TO).

The 18-year chart above provides some perspective on the recent 2.5 year bear market in the shares from a high of $40.77 in late 2010 to the recent low of $10.73 in June. The shares found major support $0.03 below the 2008 low of $10.76! 

The June low is significant due to the spike in volume as the last of the sellers have now liquidated their positions while the new shareholders have accumulated enough stock to shift the supply/demand balance in favor of the buyers.

While not easy to see on the monthly chart, the daily chart indicartes a breakout today with the shares closing at $13.99 which is the highest level the shares have traded at since April this year.

We see a great long-term buying opportunity unfolding in one of the world’s quality silver producers!

 The information contained in this report was obtained from sources believed to be reliable, however, we cannot represent that it is accurate or complete. This report is provided as a general source of information and should not be considered personal investment advice or solicitation to buy or sell securities. The views expressed are those of the author and not necessarily those of Raymond James Ltd.