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Adventure Gold (AGE, TSX-V) is an attractive pure Gold play that we first brought to the attention of our readers when it was in the low 20’s late last month, shortly after the company announced it had acquired a strategic land position at the Granada Property in northwestern Quebec.  There’s a lot to like about Adventure Gold and we’ve been tracking the stock closely the last several weeks.  The stock climbed as high as 37 cents early this month and has since found support in the low 30’s.  We’re pleased to announce we’ve added the company to the BMR Portfolio this morning.  We’ll have more on the fundamentals of AGE in the very near future but first John examines Adventure Gold’s very interesting chart:

John: Yesterday, Adventure Gold (AGE, TSX-V) opened at 32 cents, its low for the day, and closed at its high of 34 cents on very low CDNX volume of 69,000 shares.  The stock was down a penny on the day. With the across- the-board weakness in all markets yesterday, trading for AGE was a non-event. There is increased volume this morning and the stock has traded between 33 and 34.5 cents.  BMR has added AGE to its Portfolio at 34 cents.

Looking at the 3-month daily chart we see that 3 sessions ago the stock price broke out of a bullish downsloping wedge, a consolidation pattern, to the upside and then Tuesday a solid white shaved candle shows the share price moved up to close at 35 cents.   With yesterday’s volume so light and with markets displaying weakness, any bearishness in yesterday’s trading should be ignored.

The EMA(20) moving average provides solid close bullish support at 31 cents, thus the stock price at 34 cents has plenty of room to move up without getting too far from the moving average to be at an unsustainable level.

Two sets of Fibonacci levels are shown. The blue set shows the first target at 38 cents which was almost reached when AGE rose to 37 cents on October 2.  The second set (green) indicates the next Fibonacci target is 53 cents.  As stated the volume yesterday was low and we also see that the volume on all the down days has been less than the volume on the up days. This is very bullish because volume must be in the same direction as the trend for the trend to be sustained.

Looking at the indicators: The RSI is bullish, above 50% at the 60% level and flat. This is to be expected coming out of a consolidation pattern.

The Chaikin Money Flow (CMF) has had bullish buying pressure at .24 since the major move from 26 cents to 37 cents.   This is very bullish.

The ADX trend indicator has the +DI (green line) at 28 and above the -DI (red line) at 12 in bullish orientation. The ADX (black line) trend strength indicator is high at 41 but flat indicating a constant strong bullish uptrend.

Outlook: AGE’s chart indicates that we can expect the stock price to continue to move up in the near future toward the next Fibonacci target of 53 cents.