Another silver play that looks poised to breakout is Mag Silver (MVG). This is an exploration-stage company. Mag Silver is engaged in the acquisition, exploration and development of district scale projects located in the Mexican Silver Belt. This stock is off to a slow start in 2011 with shares off by around 9%.
If you take a look at the chart for Mag Silver, you'll see that this silver play recently ran up from $9 a share to its current price of just over $11 a share in just a couple of weeks. During this move, the stock saw a number of up days that registered volume close to or above its three-month average action of 128,000 shares. This could mean that large traders are starting to accumulate shares here, and they bought into this name as it crossed above both its 50-day and 200-day moving averages.Now market players should watch for a breakout trade if shares of MVG can manage to trade above some big overhead resistance at around $11.96 a share. This stock was well on its way to testing that level today after it hit a daily high of $11.67 a share. Since then, it has pulled back close to $11.20 a share. One could be a buyer of this stock on any weakness and anticipate the breakout with a mental stop just below its 200-day moving average of $10.90 a share. If you don't want to anticipate the breakout, then I would buy once it clears $11.96 on big volume. Look for volume that's tracking close to or greater than its three-month average action of 128,300 shares. If we see that signal, then I think this stock could make a quick run back towards $14 a share or possibly even higher.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV