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Barrick Gold Corporation Message Board

  • investora2z investora2z Jun 14, 2013 11:35 PM Flag

    Recent lows will be crucial

    Most stocks in the sector remain range bound between recent lows and highs. Lows provide the necessary bounce, but the higher end of the range is very difficult to overcome. Even Barrick has tried to cross the upper end a couple of times, but has failed to do so. The outlook is not as negative as it was earlier, but there is no hint of positivity either. So the grinding and the consolidation may continue. Some analysts are predicting a fall for gold next week. Since gold has not done much anyway, a fall from current levels will surely be negative for the stocks. Even if there is a recovery, that may be used for selling at higher levels. In short, it may take some time to get the sentiments to turn distinctly positive. For Barrick, the recent lows will be the key levels to watch. Currently it is more than 10% above that so there is a bit of cushion. But the fundamentals are not very supportive because the company reported a decline in revenues / net income in the last earnings. The debt is also high which makes the risk relatively higher. If gold falls further, the debt will start to look much more scarier. The current gloom has prompted some big companies to scout for low priced assets. This is because there is also an opinion that the crash over the last few months has priced in a lot of negatives for the sector. Coeur D'Alene hinted at some consolidation / acquisition around its properties in Nevada. Coeur already has a 5% stake in Pershing Gold Corporation (PGLC) which is planning to start production next year. Still, companies are not going all out, and remain cautious about the future. The next few weeks will be crucial for the short to medium term trend.

16.77+0.15(+0.90%)May 31 4:00 PMEDT