Shares of Aben Resources (TSX-V:ABN) have slid lower along with other Golden Triangle explorers in recent weeks. The delays in receiving assays back from the labs hasn’t helped the situation either; investors tend to sell first and ask questions later when they perceive that a company’s drilling results are being released later than expected.
Just a few weeks ago expectations for many of the Golden Triangles names such as Aben, Golden Ridge, and GT Gold were through the roof. Now it seems as if the market pendulum has swung the other way and the lab delays are being interpreted as being a sign that these companies don’t have anything noteworthy to announce to the market. However, from a trading standpoint it’s usually a much better idea to buy shares of stocks with lower market expectations as opposed to situations in which expectations might be overly-inflated.
The chart setups in both Aben and Golden Ridge (TSX-V:GLDN) appear to be attractive from a risk/reward standpoint.
Important support/resistance zone between C$.24 and C$.28. However, ABN still remains in a year-to-date uptrend with rising 50-day and 200-day moving averages (the slope of moving averages are more important than specific price levels).
One of my favorite fellow technicians Ty Martin posted a couple of excellent charts highlighting ‘energy points’ (confluence of trend lines that typically coincide with price reversals) in ABN and GLDN:
ABN.V Energy Point Chart
GLDN.V Energy Point Chart
Two of Ty’s recent energy point charts have worked extremely well (NVO.V and GDX) and I have a feeling that at least one of these will prove to be prescient.
Disclosure: Author owns shares of ABN.V and GLDN.V at the time of publishing this post and may buy or sell at any time without notice.
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