Newmont Looks Like a Golden Opportunity

During Monday's "Mad Money" program, host Jim Cramer told viewers he was dropping three names from his " Covid-19 Index" and adding three names. One of the names added was Newmont Goldcorp (NEM) , the world's largest precious metals mining company.

In this daily bar chart of NEM, below, we can see that prices have rallied back above the 50-day moving average line. The slower-to-react 200-day moving average line is bullish. The trading volume has been active the past six weeks and the On-Balance-Volume (OBV) line has been rising again after a May-June decline. Buyers of NEM are more aggressive again. The Moving Average Convergence Divergence (MACD) has crossed to the upside for a cover-shorts buy signal and it is close to crossing the zero-line for an outright go-long signal. 

In this weekly bar chart of NEM, below, we went back five years to show the long base pattern that NEM broke out of. This large consolidation pattern is what is powering prices higher. Investors had more than three years to accumulate shares. Prices are above the rising 40-week moving average line. The weekly OBV line shows a long rise and new highs which tells us that buyers are aggressive and NEM should soon breakout to new highs as the OBV line often leads. The MACD oscillator crossed to a take-profits sell signal but is narrowing now towards another buy signal. 

In this Point and Figure chart of NEM, below, we can see an upside price target in the $74 area. If NEM reaches $74, it will be a major upside breakout. 

Bottom line strategy: You don't have to be a gold bug or a stock market bear to appreciate the strong charts and indicators on NEM. Longs could raise stops to a close below $55. Consider adding to longs above $65 and $70.

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