If you're looking for a metal mining play that's starting to break out, then check out Denison Mines (DNN), which is engaged in uranium exploration, development, mining and milling with uranium mining projects in both the U.S. and Canada and development projects in Canada, the United States, Zambia and Mongolia. This stock has taken it on the chin so far this year, with shares off by over 35%.
If you take a look at the chart for Denison Mines, you'll see that this stock has started to move above some past overhead resistance at around $2.03 a share. This move today is coming after the stock bounced off of its rising uptrend line that started back in late June. That rising trend line shows a pattern of higher lows for DNN, which is a very bullish chart pattern. It often times means that large traders are paying up for a stock each time it dips.
What's even more bullish about the breakout move today is that it's coming on huge volume. Volume today has already clocked in at over 2.6 million shares, which is well above its three-month average of 1.6 million shares.If you're bullish on this stock, one could be a buyer on this breakout and look for a run back towards some past overhead resistance at around $2.40 to $2.50 a share, or possibly back towards its 200-day moving average of $2.69 a share. I would add aggressively to any long position if DNN takes out some more overhead resistance at around $3 a share. If you get long, you could simply stop out of the trade if DNN moves back below its 50-day moving average of $1.95 on heavy volume. >> Get your technical analysis on the go with TheStreet's iPad app.
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