Good morning,
If there’s been a key market theme over the past week and a half, it’s been stocks crashing.
Not all of them, to be sure. And most of them aren’t huge index movers.
But there’s been a heavy speculative unwind in various, diverse momentum groups recently, and I think it bears watching.
This week, we’ll review three stocks in four distinct groups that are crashing. For each group, we’ll highlight where some of the sharpest mean reversion has been, which stocks look most vulnerable, and what stocks and levels could make me interested on the long side.
We’ll end with some Hot List updates and trend changes in one sector going unnoticed by investors.
Let’s get into it!
Crashing: Precious metals miners
Agnico Eagle Mines drops 16%, finally finds some dip buyers at the 50-day
AEM has been a top gold miner and one we’ve featured here numerous times. The stock has broken support at the 21-DMA but may be trying to bounce at next support near $155. Any bounce from here is an opportunity to exit.
It was a good run for Coeur Mining
CDE gained more than 400% from its April lows, vaulting it into the top 10 holdings of the Russell 2000. But the straight-up move is over, and as the great Bob Farrell said, “Parabolic advances usually carry further than you think, but they do not correct by going sideways.”
Looking to Newmont as the bellwether
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