Point & Go Figure: MSFT, NEM vs. ABX
So NEM vs. ABX, who do you like?
The short-term conditions remain positive but at high-risk levels. The pattern of lower lows and lower highs persists for both the NYSE and Nasdaq Composite Percent Above 50-day Moving Average Indicators.
The High-Low Indices for the NYSE and Nasdaq Composite are positive (in columns of Xs), but there again the negative divergence - lower highs - persists.
The longer-term bullish percent Indices for the NYSE and Nasdaq Composite are both still in Xs, but the larger pattern of lower highs there also remains intact. The more narrow S&P 500 and Nasdaq-100 Bullish Percents are both still negative, and not even close to a reversal higher.
The picture of high risk these indicators paints continues to frustrate as the market indices make new highs in some cases. But a look back at 1999 shows a similar frustration period as broad indices made new highs on divergent indicators throughout the year before a downside resolution occurred.
Newmont Mining (NEM)
(Chart courtesy StockCharts.com)
On a long-term PnF basis (2x3 chart) NEM is technically "golden" as long as it is above the long-term trendline shown below. Based on this scale, the long-term price objective is 74 using a vertical count. If one uses the large base formed between 2002 and 2004, however, the long-term price objective is 102.
This morning Goldman downgraded NEM to in-line from outperform saying the firm believes ABX is better from a risk/reward standpoint. As the above indicates, the technicals (using the price objectives on the charts) disagree.
But what about the market? Which stock is in favor? A NEM vs. ABX PnF relative strength chart shows that NEM should clearly be favored over ABX.
NEM vs. ABX Long-term Relative Strength
(Chart courtesy StockCharts.com)
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