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I have been long a 1/2 position of Yamana Gold for about a week now, as timestamped inside the 12631 Trading Room, watching it break out and then retrace. At issue now is whether I should (big shocker here!) buy, sell, or hold. Looking at the daily chart, my inclination is to maneuver so that I can buy the rest of the position likely sometime today, with a clearly defined stop loss in place below key support.
The reason why I am devoting an entire post to this setup is not because of my direct involvement in the stock, so much as for the general strategy of this particularly type of breakout and retrace pattern. As you can see, AUY broke out of a symmetrical triangle, only pull back to the resistance trendline, extended out, on relatively benign volume. The basic idea is that this retracement represents another entry point for longs. Note also that this type of setup proffers at least one easily defined stop loss placement opportunity, that being directly below the resistance trendline from the symmetrical triangle, extended out, not to mention the 20 and 50 day moving average convergence directly below, to boot.
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Great illustration of your approach to a staged buy-in, with clear exit point if the move fails, Chess. Thanks.
Well said Hammer. Clear and succient. Chess-signed up on investor review website and left a review since it is well deserved for continually great thoughts.
Thanks, guys! @alaw: Really appreciate the great review.
Hey Chess,
What do you think about the technicals on IAG? IAG is in the same industry as AUY, except it has historically been a bit of a higher beta play.
Thanks!
Hey Ace. I think IAG can be bought with a tight stop below $21.30 ($21 at the lowest).