Gediminas Jasionis
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Scorpio Mining Corporation (TSE:SPM) (PINK:SMNPF) Produces Heaviest Trading Volume of the Year

by Gediminas Jasionis Dec 19, 2011

spm_chart.pngScorpio Mining Corporation (TSE:SPM) (PINK:SMNPF) stock price gained 11.7% on Friday on the heaviest trading volume recorded this year.

The turnover reached 10.2 million shares and was far above the daily average of 917 thousand. The stock price remained inside its vaguely defined trading channel and found resistance at $2.10.

The company had no important news that could have provoked the buying pressure. The last announcement from Scorpio was made on December 15 when the company declared to have appointed James M. Stonehouse as Vice President of Exploration.

The spike in trading activity could have been a random event as Fridays are prone to short squeezes and heavier trading in general.

scorpio_mining_logo.jpgScorpio currently holds a market cap of $411 million which gives the company a P/E ratio of 16.8 with forecasted decline to 11.7 over the coming year. This is an average valuation compared to their peers, thus the market isn't likely to let the price slip in either direction without significant news.

SPM price is in a slightly upward and very wide channel at the moment, which allows taking significant and quick profits on the bullish moves. The upcoming crossover of two major averages of 50 and 200 days suggest consolidation might get prolonged with the bearish side strengthening in the near future.

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