On the 24th July 2008 we purchased more stock in Agnico Eagle Mines Limited (AEM) at US$59.17, more than doubling our position in the company.
On the 15th July 2008 we posted an article on Agnico Eagle in which we said the following:
“There is no doubt about it Agnico-Eagle Mines Limited (AEM) is a class act and deserves a place in everyone’s portfolio, however timing an entry point is also crucial.”
At the time we were of the opinion that we were in for a long wait, however, gold prices took a battering and Agnico’s latest set of results dipped dramatically largely due to the price of Zinc falling out of bed, leading to a sell off in the stock. Going forward Agnico’s performance will be far less dependent on Zinc as the production of gold is being ramped up. When this is widely understood investors will regret unloading this stock and come back to re-purchase it.
Taking a quick look at the chart we can see that Agnico Eagle has dropped about $20.00 is a very short time. The technical indicators have been floored which suggests to us that the downside is now limited as the bulk of the damage has now been done.
Agnico-Eagle Mines Limited trades on both the New York Stock Exchange and the Toronto Stock Exchange under the ticker symbol of AEM.
Have a great weekend.
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