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« Endeavour Silver Corporation Takes Off | Main | Endeavour Silver Corporation 2009 Review and 2010 Outlook »

Pan American Silver Corporation heading into the Buy Zone

PAAS Chart 31 Jan 2010.JPG

As we can see from the above chart Pan American Silver Corporation (PAAS) has fell recently from $27.00 in December 2009 to close on Friday at $21.19 as silver prices deteriorated. The sector as a whole has also taken a tumble largely due to the strengthening of the US Dollar which now stands 79.477 on the US Dollar Index.

Sticking our necks out we don't expect to see the dollar go much higher than '80' however as the broader market sells off the dollar strengthens. As a currency we think that its future is bleak, but the alternative currencies especially the Euro appear to be performing just as badly with problems in Greece and Spain grabbing the headlines. As currencies go its a race to the bottom with the occasional upward spike to keep us all on our toes.

Back to PAAS, the stock price has now dropped below its 200dma and the other technical indicators are heading south. Once the dollar turns and it will, the precious metals should settle down and then commence their trek north to higher prices. We will need to stay awake as we have witnessed in this sector things can turn on a dime. When this happens we should be presented with great opportunities to acquire this stock.

Pan American Silver Corporation trades on the NASDAQ under the symbol of PAAS and on the Toronto Stock Exchange under the symbol of PAA. PAAS has a market capitalization of $2.23 billion, with 105.12 million shares outstanding. PAAS closed on Friday at $21.19.

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