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« Silver Wheaton: Beginning to Correct | Main | Why Investors Will Choose Gold and Silver »
Tuesday
Jul242007

Hecla Mining Pauses To Consolidate 25% Gains

Recently we have seen Hecla Mining performing exceptionally well as it rallied nearly 25% over the last month from around $7.50 to over $9.00.

Hecla Mining Pauses To Consolidate 25% Gains

However it now looks as if Hecla is taking a breather for the moment as it consolidates above the $9.00 mark.

There is no doubt from the chart that a new uptrend has formed in this silver stock. It has made higher highs and higher lows on its rally up from $7.50. Now above nine dollars, Hecla is consolidating, preparing for another rally that will be coming soon.

The stock appears to have found some support at $9.00 and it would be good to see Hecla consolidating its gains at this level. By doing this, the moving averages would move up and be closer together, closing the gaps between the 200dma, the 50dma and the stock price at the moment. If a stock soars too high above its moving averages then that is an indication that a correction may be due. We saw this happen with Hecla in April, when there was almost a $3.00 gap between the stock price and the 200dma.

Currently, there is around $1.25 between the stock price and the 200dma so there are no extreme danger signals as of yet. However, the STO and RSI are turning down and on the MACD, the black line appears to have broken down through the red, sending us a negative signal.


We see Hecla staying in this range for a while as it consolidates these gains and puts its technical indicators back in order again. It may drift slightly downwards, but we are holding on to this stock at least until the next move upwards.

Hecla is still a BUY is our silver portfolio and is trades as HL the NYSE.

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