Chart of the Day: Can This Holding Find Support at a Crucial Level?

As you may have seen, gold the commodity has been on a wild ride for the last few months. The metal produced a parabolic move that was only challenged by the run in silver, but as we have often seen with parabolic runs that turn into bubbles, those eventually collapse. We have not seen that yet in gold or the gold miners but those names certainly follow the ups/downs in the yellow metal.

IAMGOLD (IAG) is an unhedged miner, which means the company is 100% exposed to the moves in gold. That also means it will enjoy a nice rise when the metal is up but also downside when gold moves lower.

The recent rise in gold has benefited IAG, so much so the stock has been in a solid uptrend for months. Going back to August when the stock was about $7, IAMGOLD is up a staggering 185% since then, lapping the rise in gold. This miner may have been considered a laggard in the past but not any longer.

The recent volatility in gold has of course hit IAG rather hard, but this pullback to short-term support (20-day moving average) might be an ideal place to add shares. Indicators look bearish but it only means the momentum is slowing down.

As a member of the EPS Diplomats, IAMGOLD does not have a rating.

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At the time of publication, TheStreet Pro Portfolio was long IAG.