Base metal miner Labrador Iron Ore (LIF.TO) has consistently been in the Green Favored Zone of the SIA S&P/TSX Composite Index Report since October. Yesterday the shares climbed 3 spots to 14th place.
By the time overall markets crashed in the winter of 2020, Labrador Iron Ore (LIF.TO) had already been trending downward for six months. The major market plunge accelerated the decline and since both bottomed out, Labrador shares have been steadily recovering. Over the last year, the shares have regained their 50-day average, snapped a downtrend line, established an uptrend of higher lows and established support at higher levels following breakouts, all signs of underlying investor support.
Back in November, the shares regained $30.00 and have continued to advance, recently settling into the $34.00 to $40.00 range with more support possible at an uptrend line near $32.50. A breakout over $40.00 would signal the start of a new upleg. Should that occur, next potential upside resistance may appear near $42.50, $46.00 or $47.50 based on measured moves, then the $50.00 round number.
For the last year, Labrador Iron Ore (LIF.TO) has been under steady accumulation, advancing in a step pattern of rallies (signaled by a series of bullish Double Top breakouts) followed by periods of consolidation at higher levels. Currently the shares are in a consolidation phase trading below resistance in the $39.65 to $40.00 area between a prior high and a round number, while holding above support near $35.90 based on a 3-box reversal, and $34.50 based on the low of the most recent O column.
A breakout over $40.00 to a new high would complete another bullish double top and signal the start of a new upleg on trend. Should that occur, next potential resistance may appear near $43.80 based on a horizontal count, then the $49.30 to $50.00 area where vertical counts and a round number cluster.
With its bullish SMAX score increasing to 7, LIF.TO is exhibiting near-term strength against the asset classes.
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