2012 has been a tough year for shareholders of gold mining stock Rangold Resources (GOLD). While the broad market has climbed close to 9% since the first trading day of January, Rangold has seen its share price drop by 15% over that same time period.
Now, though, this $8 billion stock could be in store for some buying pressure.
That's thanks to a "V-Bottom" that's forming in shares this month. The V-Bottom isn't as well known as many other technical patterns, but its trading implications can be every bit as impactful. Essentially, a V-Bottom is formed when a dramatic shift in sentiment causes share prices to reverse a downtrend immediately, resulting in a V-shaped bottom.Right now, GOLD has resistance at $90, a price that needs to get broken to the upside before this V-Bottom can spur an actual change in trend. There's a glut of supply of shares above $90, where sellers are more eager to unload shares than buyers are to buy. Once that glut gets taken out, the high probability move for GOLD turns to the upside. Wait until a breakout above $90 before buying. Rangold shows up on a list of 8 Stocks John Paulson Loves.
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