Hecla Mining Co. - HL

[tenoreleven]

I haven't been around SHO since 2007, but given the state of the market, I decided it was time to look back at some swing trading, and this was always a favorite site to communicate with and learn from experienced traders.

Anyway, I've been having good times with Hecla mining, and I believe it may be a good long term investment as well.

Amateur that I am, I will not do any charting myself, but perhaps StockAnalyzer might like to say something about the chart? I especially like the weekly chart when considering holding Hecla for a while.

[ArnRay2125]

I'd hold on to any mining company because metals i think will increase when the economy gets better.

[Naamplao]

Ok....let us look at the profile summary of this company to find out what kind of mine it is.

In 2007, Hecla was the lowest-cost primary silver producer in North America, producing 5.6 million ounces of silver at an average total cash cost of negative $2.81 per ounce. Hecla also produced 107,708 ounces of gold. The company has exploration properties and operating mines in the U.S. and Mexico. Hecla has proven operating expertise and highly prospective exploration opportunities.

Great...it isn't gold...I hate gold I looked and this is primarily a silver play as it produces about 50 oz of silver to an ounce of gold. Amazing to have a negative cost to its production.

Mining companies have their prices tightly bound to the price of the metal that they mine. The reason that I don't like gold is that the price varies wildly and is not very predictable....that is because there is little industrial use for gold...

Here are the uses of silver...I think it is making a comeback from its loss due to digital photography

The Silver Institute - Silver Uses

As I said the price of a mine's shares are directly related to the price of its metal.

Here is a chart for Silver metal



see the stability of the price....it fell steadily but appears to have leveled off and this may be the harbinger of better prices for silver stocks.

Compare this to gold



All over the place....personally I don't believe it has the status it once had as the refuge in bad times (can they be worse than now???) or the standard of a currency (if it was Fort Knox must be busting at the seams with all that gold to support the USA printing press) .... I hate gold

Sorry for the rant....let us get back to Hecla Mining.

Having the lowest cost producer of silver as part of your portfolio is a pretty good thing I would think....lets look at the sharpchart

HL - SharpCharts from StockCharts.com

Very nice chart considering the times. It is hard to see here but the Bollinger Bands (BB) are starting to get narrow. The stock has climbed out of a hole and this probably tracks the leveling out of the price for silver. The BB's getting narrow means there will be a jump/fall soon (next week or so). The stock so far is nicely positioned for a jump rather than fall. It has crossed the 20dayMA and remained there...the MA is acting almost as a support. Note that it is headed at the 50dayMA....that may have an influence in the jump/fall later. Go above this blue line...it will jump but falling back may cause it to fall...that doesn't look like a scenario so far to me.

The RSI is at 50% and stable, the MACD is strong and headed for positive territory and there are signs that the stock is being accumulated...rather than sold-off in the Accum/dist

No negatives...all good so far....not terrific but better than most in these times.

For a long term look here is the P&F chart



Here is the resistance...it is between $2.30 - $2.40...call it $2.35. The stock reached that point and fell back. This is a pretty strong resistance point as there is a diagonal off the shoulder by the "B" that is pointing at the same point. Pass that point you are looking at $2.80 and then $3.00 with more resistances to follow that if we get there.

Support is first at $1.30 and then $1.10...we don't want to think about the consequences of falling below $1.10...but I don't see that happening...really!

For short term let's look at the 10 day BigCharts.com candlestick chart



You can see that resistance we talked about at $2.30...but there is another one showing here....at $2.00....that is next and we had a strong move to challenge this level...but there is a sign of indecision as we approach $2.00 on Monday. I don't think it will break through this resistance this time.

You can also see another level of support at $1.70 to $1.75 and the price on Monday may even fall back to this point....but it should rebound and attack $2.00

Remember in the discussion of the sharpchart I said there was a jump/fall coming?? I predict that will be associated with breaking $2.00 on the upside or falling below $1.70 on the downside. I think there will be some sideways motion for a few days before that happens....watch this closely ... you should have enough of a heads up to make a good decision when the time comes.....good luck.

[tenoreleven]

Awesome! Thanks you so much for the analysis!

[tenoreleven]

Hecla closed up at 2.09 today. Not the high of the day, but at least it traced back and closed the opening gap up. I'm still in for a swing trade here from my entry at 1.67 last week, wondering if it will make it back to the resistance at 2.35 tomorrow. Cannot predict how I will decide to sell, I'm not terribly scientific about this.

[Naamplao]

Reread the analysis I gave a couple of days ago....this is too good a stock right now to sell so early.

then again I am a LONG trader and my opinions are not that of a swing trader so accept my bias in this matter.

At the very least I would set a SELL point of $2.25 if I was selling since that is a resistance point in the chart...but personally you could be selling it and watching it march higher...the chart still looks pretty good to me.

[tenoreleven]

Actually, I already had reread it, and still appreciate it very much. I agree that this is a stock I could just hold, I'm just kind of in a "let's try some trading" mood. I have been holding a lot of BQI for two years, and am of course way down at the moment, but I still expect it to come through for me, but with all the ups and downs that charts has had I wished I had been trading it at least part of the time.

[Naamplao]

Patience....it is a virtue....and applicable to stocks as well as life in general

[Naamplao]

You are still hanging onto Hecla, I hope.....we have passed on resistance point and that is the $2.00, closing above it....this becomes our support to launch an attack at the next resistance at $2.30.....we are setting up nicely....the stock is behaves pretty close to what I predicted in my analysis below. Look at those charts the update automatically....looks good

[tenoreleven]

Yup - still holding.