USAU has been in an ascending channel on the 30-minute chart with the rise in spot and future
gold prices. With earnings coming in the next day, price broke out of the channel the top line
of which is now supported albeit without a retest. The relative volume indicator shows
in 3-4X volume surge in the past week while the RSI level is now up from 50 to 75-80.
I see this as an earnings play with a stop loss just below the upper channel line at 3.75 and
a target of 4.5 and 4.75 for a good reward-to-risk ratio. This is a quick swing trade earnings
play to compliment my much larger long-duration swing trade in GDXJ. While an expected
earnings beat is probably baked into the price I am betting that the beat will be significant and
will keep price momentum intact.
gold prices. With earnings coming in the next day, price broke out of the channel the top line
of which is now supported albeit without a retest. The relative volume indicator shows
in 3-4X volume surge in the past week while the RSI level is now up from 50 to 75-80.
I see this as an earnings play with a stop loss just below the upper channel line at 3.75 and
a target of 4.5 and 4.75 for a good reward-to-risk ratio. This is a quick swing trade earnings
play to compliment my much larger long-duration swing trade in GDXJ. While an expected
earnings beat is probably baked into the price I am betting that the beat will be significant and
will keep price momentum intact.