Is Yamana Gold Setting for a Break?

Published on Tuesday, 14 August 2012 05:24 Written by TradersHuddle Wire

New York, August 14th (TradersHuddle.com) - Yamana Gold Inc. (NYSE:AUY) closed the the trading session at $15.08, near its 50 day and 200 day moving averages currently set at $15.28 and $15.45 respectively. Yamana's price action places the stock below these important levels, which makes it difficult to be bought, as it will certainly face resistance as it approaches these important moving averages.

Yamana Gold Inc. (NYSE:AUY) is a Canadian-based gold producer with gold production, development stage properties, expoloration properties, and land positions in Brazil, Chile, Mexico, and Colombia. Yamana prodcued 1.05 million of gold equivalent ounces (GEO) in 2010. It has 4 development projects in Mexico and Brazil, expected to add 440,000 GEO.

The latest price action range, defined by a peaks and troughs algorithm, placed calculated support at $14.72 and resistance at $15.61. Traders should monitor these levels, as they provide insight into the latest price dynamics in Yamana Gold.

If traders want to establish a position on Yamana Gold, given the heavy resistance expected near the 50 and 200 day moving averages, a trade might be evident as the stock manages to break these moving averages. However, until the break materializes buying the stock is nothing different than flipping a coin.