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Sierra Metals Inc. (SMTS)

Sierra Metals stock forecast: buy or sell

Close on Sep 29th, 2020
$1.46 -0.01%
3 months performance
0.20%
Published: September 29th, 2020 - 4.15pm EDT

Sierra Metals stock outlook

  • Sierra Metals closed today at $1.46 (-1.35%) prior to presenting earnings at
  • Looking at the chart, price is drawing an scaled downtrend since mid-June with lower tops and lower bottoms. this downtrend marked a -46.91% loss.
  • Sierra Metals Inc. focuses on the production, exploration, and development of precious and base metals in Peru and Mexico.

Important:
The thoughts written in this post are personal and should not be followed as recommendations for you to buy or sell shares. The author of this report does not know the particular conditions of the reader, his or her finances or his or her own best interests at any given time. All users should speak with their financial advisor before buying or selling any securities Opinions are expressed for informational purposes only

Sierra Metals stock charts

Should I buy Sierra Metals stock?

All successful traders recommend adhering to a trading strategy and not make decisions based on subjective opinions, rumors or feelings. Trading strategies are meant for helping you in the decision process of what stocks to pick and when is the best moment to buy them. At Stocks2.com, we like to use very simple but trusted and powerful trend following trading strategies. Simple things usually work the best

Is SMTS stock a buy?

Currently, Sierra Metals stock doesn't match any of these trading strategies, so our recommendation is not to buy now. This doesn't mean SMTS will slide in coming sessions, or it will not rise higher. Simply, it doesn't match our recommended trading systems

Should I sell Sierra Metals stock?

How to know when is it time to sell Sierra Metals stock?. Trading strategies help us to avoid rash decisions based on our emotions or the buzz surrounding the market. We like very simple strategies to guide us on when is the best moment to sell a stock. Be aware that these strategies are not intended for shorting Sierra Metals stock

As a golden rule, you should not keep a trade that leads to higher than expected losses by the time of the buy. The timing to sell shares must always be determined by the stop-loss (automatic or manual)

Is it time to sell Sierra Metals stock?

Currently, Sierra Metals stock doesn't match any of our preferred sell setups, so if you own Sierra Metals stock and your operation is in profit probably is not time to sell now

Analysts' recommendations to buy or sell Sierra Metals stock

Brokerage firms and financial institutions post stock ratings based on their views of the market and the fundamental and technical situation of the analyzed stock. Unfortunately, the accuracy of these predictions is not very high, and certainly not a direct buy or sell signal

In the last 30 days we couldn't find any rating for Sierra Metals

Technical analysis

From a technical standpoint, Sierra Metals continues trending lower since mid-June, and has accumulated a selloff of -46.91%. Like in all downtrends, the stock oscillates drawing lower highs and lows. In this case, we have seen 3 consecutive lower tops

SMAs overview

A favorite tool of many technical analysts are the moving averages, that easily show trend direction. A moving average is calculated as the simple mean of the previous N periods (usually sessions). Usual time periods used for moving averages are 21 days, 50 days, 100 days and 200 days

SMTS SMAs chart

Supports and resistances

Technical analysts use supports and resistances to identify price points on a chart that may behave as obstacles, containing the price of an asset to move in certain direction. Supports are levels where the price tends to find support as it falls. Price is more likely to "rebound" this level rather than break through it. Nevertheless, if the price breaks down this level, it will probably continue descending until meeting another support level. In contrast, resistances are where the price tends to find resistance as it moves up. In the same way, the price is more liable to "bounce off" at this level, and if it finally ruptures this level, it will rally easily until it finds the next resistance

The current resistances are:

  • R1: $1.48 (1.37% above)
  • R2: $1.50 (2.74% above)
  • R3: $1.52 (4.11% above)
  • The current support levels are:

  • S1: $1.40 (-4.11% below)
  • S2: $1.38 (-5.48% below)
  • S3: $1.32 (-9.59% below)
  • Bollinger bands

    So-called Bollinger bands are a popular technical strategy developed by John Bollinger. By essence, the Bollinger Bands are lines that flow around a moving averagediffering in distance from the bottom to the top depending on market volatility. They are usually drawn by an offset of two standard deviations, above and below, from a moving average line. Bollinger himself recommends the moving average period to be 20

    Since the price broke down the lower band last Thursday, the price bounced off by 5.8%

    SMTS RSI chart

    Relative strength index

    The Relative Strength Index is an oscillator-type indicator that measures price action to detect when the share or financial asset is oversold or overbought. Like other oscillation indicators, the RSI fluctuates in a range between 0 and 100. The relative strength indicator is one of the best known and most widely used indicators, and it was invented by J. Welles Wilder in 1978

    The RSI dropped below the overbought level of 70 in late July after just crossing to the overbough zone for a single day (weak signal). The RSI value today was 46.72. Sierra Metals stock collapsed a 17.05% since then

    SMTS RSI chart

    Earnings and financials

    In late July, Sierra Metals had the financial event and presented the second-quarter report. The analysts estimate is a an Earnings per Share of $-0.01, that is a -125% lower than Q1 quarter.

    This compares to earnings of $0.00 per share a year ago, so current EPS means -. Sales collapsed a -17.31% on an annualized basis in the Q2, from $50.7M to $41.9M last quarter.

    Sierra Metals is hosting the earnings call. If you hold or you are planning to buy Sierra Metals shares, be careful as earnings reporting day usually has a very high volatility, and price can soar and sink with very low liquidity and not respecting your buy/stop-loss orders. Have a look company's website to confirm time and details on the earnings call and the earnings report.

    SMTS revenues and profits chart