Agnico-Eagle Mines Soars?

01/18/13 08:03:56 AM

by Koos van der Merwe

On December 12, 2012, Agnico-Eagle Mines Ltd. announced that it was increasing its quarterly dividend by 10%. Worth a look?

Security: AEM-T
Position: Buy

Agnico-Eagle (AEM-T) is a long-established, Canadian-headquartered gold producer with operations located in Canada, Finland, and Mexico. The company has full exposure to higher gold prices consistent with its policy of no-forward gold sales. The company has been paying a dividend for 31 consecutive years, showing that it is a stable company, and worth looking at for a long-term investment. So we did take a look.

FIGURE 1: AEM-T, DAILY. This chart of Agnico-Eagle is showing buy signals.

Graphic provided by: OmniTrader.

Figure 1 is an OmniTrader chart showing the following:

1. A low of $28.33 on November 15, 2012, with a buy signal given by the vote line based on the relative strength index (RSI) 12-period strategy. This buy signal was followed by the Verve trailing stop strategy.
2. On December 10, the vote line gave another buy signal and the price did rise for one day.
3. On December 12, the price broke below the Verve trailing stop, giving a sell signal. The vote line, however, remained positive, and the share price rose strongly for three days to a high of $31.78 by December 20, but then fell, giving another Verve trailing-stop sell signal to a low of $28.56 by December 31.
4. The vote line stayed in buy mode. A look at the strategies below the vote line shows the internal band, red green long, red green long stop, RSI 12 period, and Verve trailing-stop strategies all gave buy signals.
5. Do note the RSI four-period indicator is suggesting short-term weakness. The RSI 14-period indicator is suggesting strength.
What bodes for the future?

FIGURE 2: AEM-T. Here's an Elliott wave count of Agnico-Eagle.

Graphic provided by: AdvancedGET.

Figure 2 is an Elliott wave count suggesting that a wave 4 has been completed and that a wave 5 is in the process of forming. The target suggested is $60.55. The RSI 14-period indicator has given a buy.
I would be a buyer of Agnico-Eagle Mines at the present price, with a hold for the long term.

Koos van der Merwe

Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.

Address:	3256 West 24th Ave
	Vancouver, BC
Phone # for sales:	6042634214
E-mail address:	petroosp@gmail.com

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Agnico-Eagle Mines Soars?

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