Friday, July 15, 2011

For Caledonia Mining Company Is It Now Or Never (Part Deux)

Caledonia Mining Corporation (CALVF) owns and operates the Blanket Gold Mine in Zimbabwe and is now producing over 40,000 ounces of gold annually.

Caledonia is an African focused mining and exploration company with an operating gold mine in Zimbabwe, two platinum-nickel exploration projects in South Africa and a cobalt-copper exploration project in Zambia amongst its exploration portfolio in South Africa, Zimbabwe and Zambia.

Caledonia's share price has been hindered by the indigenisation law passed in Zimbabwe back in 2008. The uncertainty has created a possible opportunity to reap rewards in a company that many believe is being unfairly punished for this uncertainty.

If you take a look at this long term chart that I produced back on February 23, 2011, you will see that shares in Caledonia can be highly explosive to the upside. The caveat is that this has only happened twice ever in the history of Caledonia's stock (CALVF).

Both times when the stock price took off to the upside like a rocket ship, the technical setup had the same looks as it does right this second.

Here is the monthly chart from February 23, 2011:

Now I want you to take a look at this updated chart that I created today. Unfortunately, Big Charts has deleted about 10 years of the data that the previous chart contained, but that is ok, because this shortened view lets us zoom in to where we are precisely today.

What I have been waiting for is the slow stochastic to come back down from above the 80 level to under the 50 level. Then, if the previous patterns hold true, it will once again start heading back up to above the 80 level. But this time, the price will explode higher with it.

So take a look at where we are today and you will see that the slow stochastic has indeed come back down below the 50 level and is thus ready to turn higher again.

Here is the current monthly chart:

I just added to my CALVF position today as the chart is so compelling that I would be kicking myself forever if I did not have a suitable position to speculate in this Gold mining and base metal stock.

If history repeats itself, Caledonia's stock could rapidly appreciate by a magnitude of 10 to 100 times it's current price in a time period of 1 year or less.

With the price of Gold hitting all time highs in almost all fiat paper currencies and with Caledonia producing a significant amount of gold, this may be the perfect time to get into Caledonia and ride the CALVF rocket to extreme wealth.

: I own stock in CALVF. I have owned it for many years. I bought more today. Caldedonia Mining is a penny stock which means it is highly risky, volatile and possibly illiquid. No one can predict the future with absolute certainty (but we can sure try).

Always consult with your financial adviser before making any investment decisions. Do not rely on a blog like Market Bust for your investing information. Do you own due diligence and invest accordingly.