NEW BEARISH Plays
AngloGold Ashanti Ltd. - AU - close: 24.24 change: -0.84
Stop Loss: 25.55
Current Gain/Loss: unopened
Entry on March 01 at $--.--
Listed on February 28, 2013
Time Frame: 3 to 6 weeks
Average Daily Volume = 2.0 million
New Positions: Yes, see below
Why We Like It:
The oversold bounce in gold prices has reversed and the precious metal is sinking again. This is weighing heavily on the mining stocks. AU is a South African gold miner and the stock just broke down to a new four-year low. The breakdown below round-number support at $25.00 looks pretty ugly.
We are suggesting new bearish positions now, at the open tomorrow. We want to keep our position size small because AU is arguably already short-term oversold. Of course it can grow a lot more oversold. Our target is $20.25. Readers may want to buy the put options, which can allow you to limit your risk to the cost of the option.
FYI: The Point & Figure chart for AU is bearish with a $13.00 target.
Suggested Position: short AU stock @ (the open)
- (or for more adventurous traders, try this option) -
buy the Apr $24 PUT (AU1320p24) current ask $1.05