Technical analyst Clive Maund examines Emerita Resources Corp. (EMO: TSX.V; EMOTF: OTCMKTS; LLJA: FSE) following his April article to explain why he thinks we are at the start of a major bull market for the stock.
From the article on Emerita Resources Corp. (EMO: TSX.V; EMOTF: OTCMKTS; LLJA: FSE) was released on April 5, it took off sharply higher with a move that should mark the start of a major bull market for the stock.
A crucial point that investors need to understand with Emerita Resources is that, as a polymetallic resources company, it explores and delineates a wide range of base and precious metal deposits, and it is certainly the right place to be right now with a wide range of resources. The bull market outlook for raw materials and especially metals has already begun.
The basic arguments in favor of purchasing Emerita were presented as follows: original article, and it was illustrated with a selection of interesting slides from the company's investor presentation. You are referred to this article to view them. This update will include different slides from the new month of May. investor presentation to give us some additional basic information.
The improving business environment for resource companies in Europe, as shown on our first slide, is very positive.
As a polymetallic resource stock, Emerita will produce a wide range of metals once operational, as shown on the next slide, which also clearly shows that significant discoveries have already been made on the company's properties.
Coming back to some details, we see on the next slide that high grades of copper and gold have been discovered on the La Romanera property, which is good to know given that copper is likely entering its biggest bull market ever seen with massive looming supply shortages in the market. Horizon and gold are also embarking on a massive bull market due to the current fiat currency system reaching its nemesis.
The La Romanera deposit is part of the Nuevo Tintillo property and its location and position can be seen either on the appropriate slide included in the original article or on page five of the new month of May investor presentation.
The following slide highlights the drilling program at La Romanera and shows the grades of a wide range of metals found by different drill holes at the deposit.
Finally, Emerita has applied for an operating license for its westernmost IBW (Iberian Belt West) property, which, once granted, will confer a term of 30 years renewable up to 90 years.
Turning now to Emerita's stock charts, we see that the valuation made in the article of April 3, that Emerita Resources was at or very close to the bottom of the right shoulder of a head-and-shoulders bottom turned out to be correct, and although we were a little early because it didn't do anything for a month it was better to be early than This month again it exploded so that we were up 95% by the time it peaked on May 17th at CA$0.78 as shown by its 3 month chart below.
After such a move, it's normal for a stock to take a break to consolidate or react somewhat, which is what it has been doing over the past few days, and why the rally ended where it did completed is clearly visible on its 2-year chart. below.
On this chart we can see that the rally has taken it up to the upper boundary or “neckline” of the lower head and shoulders, and as it is unlikely to break out of the pattern when it is in an overbought state, it was natural for it to take a break to consolidate here, especially since it had also arrived at the fairly strong resistance band manifested during previous trading in this price zone.
The purpose of this update at this point is to highlight that this month's strong rally exhibits the characteristics of an “impulse wave”, that is, a movement in the direction of the trend primary, and thus marks the start of a major bull market. . This means that after a consolidation in this area to eliminate some of the supply overhanging the indicated resistance zone, it should then move forward in a further rise against the backdrop of a solid progression of the sector then as its bull market continues to rally. pace. The target for the next increase is the CA$1.25 area.
The bottom line is that Emerita Resources continues to be considered a strong buy despite its sizable percentage gains this month, especially if we were to see a minor near-term correction. The first target for an advance is the C$0.95 area.
Distinguished resources website.
Emerita Resources Corp. (EMO: TSX.V; EMOTF: OTCMKTS; LLJA: FSE) closed at CA$0.72, US$0.526 on May 28, 2024.
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Important Disclosures:
- Emerita Resources Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee of between US$4,000 and US$5,000.
- For this article, the company paid Street Smart US$1,500 in addition to its monthly sponsorship fee.
- Certification and remuneration of authors: (Clive Maund of clivemaund.com) is compensated as an independent contractor by Street Smart, a subsidiary of Streetwise Reports, for the writing of this article. Maund qualified as a British Technical Analyst in 1989. The recommendations and opinions expressed in this content fairly reflect the personal, independent and objective views of the author regarding all designated securities discussed. No part of the compensation received by the author was, is, or will be directly or indirectly related to the specific recommendations or opinions expressed.
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Clivemaund.com Disclosures
The above represents the opinion and analysis of Mr. Maund, based on data available to him at the time of writing. Mr. Maund's opinions are his own and do not constitute a recommendation or offer to buy or sell any security. Because trading and investing in any financial market may involve significant risk of loss, Mr. Maund recommends that you consult a qualified investment advisor, licensed by the appropriate regulatory bodies in your jurisdiction, and make your own due diligence and your own research when making any kind of transactions. of a transaction with financial consequences. Although qualified and experienced stock analyst, Clive Maund is not a registered securities advisor. Therefore, Mr. Maund's opinions on the market and stocks should not be construed solely as a recommendation or solicitation to buy and sell securities.