Hecla Mining

[There was some discussion in the chat room this morning concerning Hecla's steep plunge.  The closure of the firm's Lucky Friday mine by regulators has created an excellent buying opportunity, says our friend Phil Calderone.  He spells out the reasons below. Please note that from a Hidden Pivot standpoint, the stock looks like it has further to fall.  The low so far on this morning's nasty gap was 4.25, but HL could fall to as low as 3.72 before reaching hidden support. RA] The oft quoted saying, referring to the Chinese symbol being the same for crises and opportunity, has indeed provided such an opportunity. The single biggest fear for investors in legitimate mining companies (i.e., where the mineral actually exists) is an accident that temporarily halts production. Such an occurrence happened to HL's Lucky Friday mine in December. Today, the company announced that the government regulators are making them keep the mine closed for the rest of this year to repair the damage and make the facility safe to reopen. Naturally, the stock is getting crushed. This is one of the major reasons why I have repeatedly recommended 90% of one's assets be invested in CEF (no mining risk) and only the rest be considered for a speculative trade in HL. The opportunity is that HL still expects to produce 7 million ounces of silver in 2012 versus its earlier projections of 9 to 9.5 million ounces before this development. The silver in the ground doesn't disappear like an oil spill. It is still there. It will cost more to bring out with the added expense of cleaning up and repairing the facility, but their production cost of about one dollar an ounce is insignificant to the price of silver. So, anyone who hasn't bought HL before, gets a

Using information disseminated in the chat room, we took a casual swing at Hecla yesterday that was based on a minor impulse leg and a strong tout from our friend Phil Calderone. I will formalize the effort to get long in this stock if an exceptional opportunity arises, but at this moment I do not share Phil's sense of urgency. A print at 5.62 would change that, but we can let it happen first before we act. For those eager to imbibe more risk, the stock is working on a bullish impulse leg on the hourly chart that bids fair to deliver 5.47. (A=5.10, on June 7; B=5.39, C=5.18)  The entry signal was tripped ay 5.25, but the stock would need to push above the 5.33 midpoint to become a more enticing bet. Entry at that point would presumably be via camouflage, but you may need to hunker down on the 3-minute chart to find it.

Our friend Phil Calderone sent us a note recently asserting that Hecla Mining (NYSE: HL) and Central Fund (AMEX: CEF) were as close to a "sure thing" as any bullion plays he's seen in years. From a Hidden Pivot perspective, CEF became a speculative "buy" this morning, although Hecla, trading for 5.24 at this moment, would need t hit 5.37 to create an equally buyable, bullish impulse leg on its hourly chart.  Here's Phil with a full explanation that he sent me on May 20 -- and caveat emptor! “It has often been said, that in life, there are ONLY two sure things. Death &Taxes! When it comes to betting on sports or speculating on stocks, real estate or even people, there is no such thing as a sure thing. Given that proviso, I have identified a number of very profitable stock picks over more than 40 years of studying the markets. I believe that a situation currently presents itself as one of the best risk reward opportunities in a number of years. Anyone who knows me is familiar with my ongoing recommendation, especially since 2001, of gold and silver as a protector and grower of wealth. My core recommendation since that year, when I first came across and researched Central Fund of Canada, CEF, started with buy recommendations @3.16. I have continuously recommended it multiple times at various prices since and continue to believe that money should be held in shares of CEF, instead of bank accounts, bonds, real estate, stocks etc. that will otherwise be ravaged by the continuing decline of the dollar. The “close as it gets to a sure thing” trade is a stock, that has the usual risks of any stock investment. However, given the company fundamentals, my stock chart analysis, and the fact that Silver is the most undervalued