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Wednesday
May282008
Hecla Mining: Short-term BUY!
Wednesday, May 28, 2008 at 05:40PM
Hecla Mining Company has been a good vehicle for us in terms of generating profits through short-term trades. We now see this silver producer as being oversold and have therefore decided to buy today at an average price of $9.61.
Having come off a high of $13.03 this stock has dropped back to close at $9.53 as of Friday 23rd May 2008. We can see from the chart that it is now trading under its 200dma, which is where we like to make an acquisition. The MACD has almost made a golden cross with the black line crossing over the red line in an upward movement and the RSI has bounced off the ‘30’ level to head north. The stockastics are pointing south so there maybe further to go in that direction. However its a chance we have decided to take.
The following is a brief history of our trades in Hecla as written in our latest portfolio update:
“Initially we bought this stock for $5.27 - a quality silver stock which was going along nicely and then we thought Hecla was overbought, as it hadn’t corrected with other silver stocks, therefore we took profits on Hecla at $11.89, the stock price then dropped so we bought it back at $9.72, getting a 18% discount on our shares. On the 14th April we sold 50% of this stock for $11.79 in order to lock in some profits as we anticipated a fall. HL closed yesterday at $10.37. We are constantly monitoring this market with the view to identifying a suitable re-entry point when we can once again re-purchase HL shares.”
We are now of the opinion that the suitable re-entry point has arrived. We all know that it is impossible to get in at the exact bottom and out at the exact top, however we now believe that the downside is limited. In attempting these short-term trades we need to consider the downside. This may not suit you, but to us the downside if we get it wrong is that we end up holding a few more of Hecla’s stock. As we are of the opinion that both silver and Hecla will be a lot higher by the end of the year we are comfortable with this possibility.
To add some spice to the mix we have thrown in a few more opinions in the Footnote.
Footnote:
FYI this is what some analysts are saying about Hecla Mining from ‘outperform' to 'sell’
NEW YORK, March 10 (newratings.com) - Analysts at BMO Capital Markets reiterate their "outperform" rating on Hecla Mining Co (HL). The target price has been raised from $12 to $13.50.
NEW YORK, May 13 (newratings.com) - Analysts at RBC Capital Markets maintain their "outperform" rating on Hecla Mining Co (HL), while reducing their estimates for the company. The target price has been reduced from $16 to $15.
NEW YORK, April 11 (newratings.com) - In a research note published yesterday, analysts at Matrix Research downgrade Hecla Mining Company (HL) from "sell" to "strong sell ."
Please note that the issue dates are all different so it is not a like for like comparison, but it is interesting to note the divergence in these projections.
Have a dazzling week.
Please stay tuned for our trading signals by subscribing to The Silver Prices Newsletter completely FREE of charge. Simply click here and enter your email address.
If you are also interested in gold and gold mining stocks and wish to subscribe to The FREE Gold Prices Newsletter then please click here.
Having come off a high of $13.03 this stock has dropped back to close at $9.53 as of Friday 23rd May 2008. We can see from the chart that it is now trading under its 200dma, which is where we like to make an acquisition. The MACD has almost made a golden cross with the black line crossing over the red line in an upward movement and the RSI has bounced off the ‘30’ level to head north. The stockastics are pointing south so there maybe further to go in that direction. However its a chance we have decided to take.
The following is a brief history of our trades in Hecla as written in our latest portfolio update:
“Initially we bought this stock for $5.27 - a quality silver stock which was going along nicely and then we thought Hecla was overbought, as it hadn’t corrected with other silver stocks, therefore we took profits on Hecla at $11.89, the stock price then dropped so we bought it back at $9.72, getting a 18% discount on our shares. On the 14th April we sold 50% of this stock for $11.79 in order to lock in some profits as we anticipated a fall. HL closed yesterday at $10.37. We are constantly monitoring this market with the view to identifying a suitable re-entry point when we can once again re-purchase HL shares.”
We are now of the opinion that the suitable re-entry point has arrived. We all know that it is impossible to get in at the exact bottom and out at the exact top, however we now believe that the downside is limited. In attempting these short-term trades we need to consider the downside. This may not suit you, but to us the downside if we get it wrong is that we end up holding a few more of Hecla’s stock. As we are of the opinion that both silver and Hecla will be a lot higher by the end of the year we are comfortable with this possibility.
To add some spice to the mix we have thrown in a few more opinions in the Footnote.
Footnote:
FYI this is what some analysts are saying about Hecla Mining from ‘outperform' to 'sell’
NEW YORK, March 10 (newratings.com) - Analysts at BMO Capital Markets reiterate their "outperform" rating on Hecla Mining Co (HL). The target price has been raised from $12 to $13.50.
NEW YORK, May 13 (newratings.com) - Analysts at RBC Capital Markets maintain their "outperform" rating on Hecla Mining Co (HL), while reducing their estimates for the company. The target price has been reduced from $16 to $15.
NEW YORK, April 11 (newratings.com) - In a research note published yesterday, analysts at Matrix Research downgrade Hecla Mining Company (HL) from "sell" to "strong sell ."
Please note that the issue dates are all different so it is not a like for like comparison, but it is interesting to note the divergence in these projections.
Have a dazzling week.
Please stay tuned for our trading signals by subscribing to The Silver Prices Newsletter completely FREE of charge. Simply click here and enter your email address.
If you are also interested in gold and gold mining stocks and wish to subscribe to The FREE Gold Prices Newsletter then please click here.
Reader Comments (4)
Just added to my HL holdings at $8.25 today. I'm not much of a trader so this is for the long haul.
Rich, A good move in our humble opinion.
Looks oversold
Looks to have hit the long term up trend line on the 3 year chart. Thoughts?