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June 17, 2009 / Jeb

Reversal Hammer Patterns in NGD, GMO, TGB and DNN

I mentioned in a previous message that the hammer pattern is useful to indicate trend reversal.  Last night I mentioned that I expect to see New Gold (NGD) to get support at the 20 day moving average. Today it did with a major reversal pattern closing at the high of the day.  Most of today all the weak hands of NGD were shaken out.   I expect the correction to be over in NGD and for it to break to new 6 month highs.

It is hard to hold on to your shares when your stock is correcting and it is easy to hold on to your shares when it is flying.  As a trader and technician the key is not to let your emotions get the best of you.  Have rules when to take profits and losses.

NGD

Denison (DNN) also had a huge washout today as it came to its support.  It broke through that support and triggered all the stop losses associated with it and closed at the high of the day as well.  This is the perfect opportunity to get into one of the leading uranium companies trading below book value.

NGD

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