Sabina Breaks Out

A few weeks ago we highlighted Sabina Gold & Silver (SBB.TO) as a gold explorer that was set to outperform in 2016. SBB has strong fundamentals (including substantial recent insider buying and ownership, including by CEO Bruce McLeod) and SBB shares have consistently exhibited strength relative to its peers in the junior gold sector. After bumping up against resistance near .80 for a couple of weeks SBB broke out aggressively on Friday:


SBB.TO (Daily)


Since bottoming last August SBB has been executing a classic Elliott Wave sequence. If this assessment is correct SBB is currently on the 3rd wave, which is the longest and usually the most powerful wave of the sequence. Moreover, the chart pattern breakout which took place Friday targets at least C$1.00.

SBB has been exhibiting strong signs of accumulation since October and Friday’s high volume surge is an indication that buyers are becoming more aggressive and the supply near C$.77-C$.80 has been depleted. The next natural pocket of supply is up at C$1.00 and beyond the round number resistance at $1 SBB could easily soar another 40%-50% to test resistance from 2013.