Hochschild Mining plc : The correction could continue
By Bastien Chabasseuil
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
GBX 120.67 | GBX 0 | GBX 136.2 | +100% |
The fundamental situation of the company remains very fragile. Currently, the company is trading 4.94 times its EBITDA knowing that the earnings is negative in 2013. It's also difficult to be optimistic with the sharp EPS revisions during the past 12 months.
Graphically, we can see that the stock is in a bearish trend with decreasing moving averages, which serve as slant resistance. The security is moving towards GBp 91.25 in daily data, the next support area.
Investors could take a short position to target the GBp 91.25 support after a crossing of the GBp 110.5 area. A stop loss is placed above the GBp 126.5 resistance, threshold that would invalidate the short-term bearish strategy.