Monday, December 17, 2012

12/17: First Majestic Silver Corp. (AG)

First Majestic Silver Corp. (FR on the TSX; AG on the NYSE) is another well-positioned junior silver mining company that is well-leveraged to the coming price rise in Silver. I've been following the company for several years and I believe that I have a good sense for the stock's Elliott Wave count.

As you can see from the 2 charts below, the weekly chart shows the secular trend for First Majestic since the 2003 low and it appears we completed Wave IV in the summer of this year, consistent with the Wave IV lows in SILVER and Silver Wheaton this summer.

The daily chart now shows First Majestic's daily pattern (NYSE listing) since the Wave IV low in May and this count seems to show that we have completed Wave (3) of Wave V but have not yet set a Wave (4) low. To me, it appears that Wave (4) is still in process in the form of an expanding triangle and, if so, we should see one more new incremental high above $24.20 [Wave (d)] in First Majestic and then an incremental new low below $20.41 [Wave (e)] before we bottom and Wave (5) of V commences...

I purchased 1,000 shares of AG this morning at $21.25 in my CBOE paperTrade account in hopes of a short-term trade to Wave (d). The stock has sold off strongly in early morning trading due to the announcement of its acquisition of Orko Silver.

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