Eye on AVL
by Mike Paulenoff, Thu September 22nd, 2011
Rare earth names are getting cheap. The only question is how much cheaper before Mr. Market considers them in a fire sale?
For those of us who think that the rare-earth, or strategic resource, space is actually worth something, then we have to take another peak at Avalon Rare Metals (AVL), which is at or very near to its intermediate-term corrective swing target zone of 2.77 off of its April high at 10.11.
Today's low is 2.81, from where AVL has since bounced a bit to 2.90-.95. This is not to say that AVL must hold at or above 2.77, because one look my enclosed channel work suggests that if the overall market continues to head due south, AVL potentially could press into the area of its lower channel support lines between 2.45 and 2.15.
From there, though, I would be expecting a significant technical reversal signal to emerge, assuming AVL remains a viable, real company. With these levels in mind, let's once again keep AVL on our radar screens.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
