$SBGL – Divergences don’t matter until they do Part II

It’s time to try wild and crazy SBGL again. Probably the entire sector of gold stocks for that matter…

Last time this stock traded it yielded a great gain. And now it has fallen all the way back to where the last rally began. Who says the trend is your friend? Not as much sometimes as the swing.

Divergences don’t matter until they do Part I

So what to do now?

It’s a buy now with a tight stop. Thurday’s low? Wednesday’s low? Depends on the individual trader. Last time was stopped out twice for small losses before grabbing the big gain.

In addition according to YAHOO FINANCE the stock is currently pay a whopping 8.9% dividend, which makes a candidate for a buy-and-hold if an initial swing can give enough of a profit cushion for a safe investment.

To see the divergence, check the lower graph on the chart below.

(click on the chart for a larger view)

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