ECU SILVER update - another bite at the cherry...

originally published May 14th, 2009

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• ECU SILVER update - another bite at the cherry...
  May 14th, 2009
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  January 29th, 2009
• ECU SILVER MINING update...
  January 19th, 2009

ECU Silver was afflicted last year by a combination of mindless across the board liquidation of assets as a result of the deleveraging tsunami, and uncertainty about whether it would succeed in getting the funds together to complete a key mill. Well, it got the funds for the mill which is now in operation and ECU has now poured its first silver and has an income stream to fund its operations. Small wonder then that the stock is now recovering and given the impressive magnitude of its defined and inferred resources, the outlook for this silver stock is very bright indeed.

We picked up on the strong accumulation of ECU and bought it last month at a very good price, having spotted a bullish Flag formation developing after a preliminary breakout from a downsloping Pan base area. Just over a week after we bought it, it suddenly surged way above its 50-day moving average on very heavy volume, a clearly bullish move. After 3 up days on good volume it settled into a reactive phase, which we can now see is a Pennant, similar to the earlier Flag, but with more converging boundaries. As this Pennant has formed, volume has died back in a most satisfactory manner, becoming comparatively light in recent days. This is very bullish - it is a sign that another upleg is incubating, and it looks likely to advance almost whatever happens to the sector, on account of the companies` exceptionally strong fundamentals. Even if should break below the support at 60 cents and slump back into the base area in adverse market conditions it would be unlikely to drop much before steadying and turning up again. Much more probable is that it embarks on another sharp upleg from here shortly. Therefore ECU is rated a buy again here and those already holding should of course stay long. Traders should note the position of the next zone of significant resistance and look to take profits upon it making a lunge at the 80 cent area, with the aim of buying back in on the next reaction/consolidation.

The number of shares in issue is a rather large 242 million, but it had a large number of shares in issue before the big runup in 2006. ECU trades in good volumes on the US OTC market under the code ECUXF.

ECU Silver website

ECU Silver Mining Inc, ECU.TO, ECUXF on Other OTC, closed at C$0.61 and $0.5435 on 10th May 09.