Some long-term Buying opportunities
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Mirabela Nickel Limited (MBN)
Technical Recommendation: Buy
(Click here for MBN fundamental research and company information)
MBN declined by 92% between May 2008 and January 2009. It then rallied sharply (+420%) to the September 2009 high, before declining by 55% into late October 2010.
Volume and momentum indicators suggest that the stock has been basing since late August, and the recent break above the April downtrend has resulted in a sharp move to the upside.
In Monday trading price has pushed above the September and October highs, completing a small base formation. The next resistance is the 200DMA which currently sits at $2.05. Given the strong gains over the past few days, this resistance could curb upside potential in the near term; but from a longer-term perspective the stock is positive.
A move to test the September 2009 downtrend is likely over the next few months; this gives upside potential to approximately $2.36.
MBN is rated as a Speculative Buy.
The stop-loss level is $1.63.
(click image to enlarge)