Yamana Gold: Long-entry for the medium term

Although lacking somewhat within the miners sub-sector, risk/reward is very favourable for some long-term buying. The corrective pattern since mid-2016 has based out around the 76.4% retracement level, which is common for multi-year primary trend reversals. Obviously metal spot prices have been very strong lately, resulting in a fierce rally for various miners, including Yamana.

We expect a breach of the trigger at 3.12 before the end of the week. Such a break unleashes a new primary uptrend towards the main target at 9.40 (!). There are some pivots at 6-even, but this zone should not pose too much trouble when things really get going. On the downside, maintain stops at 2.20.

If you prefer larger caps within the sector, take a look at ABX, NEM and CFE. Although riskier, we really like Yamana for it’s very interesting P/L ratio.

Primary trend: neutral (positive > 3.12)
Outlook: major trend reversal above 3.12, positive
Strategy: long-entry > 3.12
Support: 2.64 / 2.20
Resistance: 3.12 / 3.51 / 6.00 / 9.40*
Outlook cancelled/neutralized below 2.20