New York, May 18th (TradersHuddle.com) - Shares of Pan American Silver Corporation (NASDAQ:PAAS) ended the trading session higher by $0.16 or 0.5% from its previous close. Pan American's price action formed what is considered to be a bullish engulfing candle that could very well signal continuation of trend or reversal on ongoing weakness.
Pan American Silver Corporation (NASDAQ:PAAS) is the second largest primary silver producer in the world. The company has seven operating mines in Mexico, Peru, Argentina and Bolivia. Pan American also owns the Navidad silver deposit, one of the largest undeveloped silver deposits in the world and is the operator of the La Preciosa silver project, which is a joint-venture with Orko Silver.
Pan American's recent stock range has been formed by a trough where calculated support was defined at $31.34 and by a peak that established the resistance level at $43.06, which could be used by traders planning their trades.
Traders wanting to establish a position in Pan American Silver or traders that are already holding the stock can use the bullish engulfing pattern to their advantage. The pattern provides a defined risk as it shows where the bears were able to push the stock down, before the bulls stepped in.
The bullish engulfing pattern is a leading indicator that provides an alert to the bulls that the trend will continue or that there is an immediate reversal to the short term weakness seen on the stock. Below an Engulfing Bullish Candle Illustration:
