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Eurasia Mining Shares Have Formed a Pre-Breakout Structure. When Will They Break Out?

Updated: 24 Mar 2021

Shares of Eurasia Mining plc (LON: EUA) have formed a pre breakout structure on the daily chart following January’s massive selloff after Alexei Churakov sold 27.4 million shares. The company has since recovered most of its losses, but its shares are yet to break higher.

With most of its operations in Russia, the palladium and platinum miner had attracted significant short interest following its 7,800% rally in 2020. Still, the pullback that started in December should have reduced the short interest.

Eurasia Mining is well-positioned to capitalise on the rising demand for battery metals, including palladium and platinum, which it produces at its mines. The company recently announced that the Russian State Committee on Reserves approved its definitive feasibility study on its West Kytlim platinum project in Russia’s Urals.

The company is still in negotiations with potential suitors as it looks to be acquired despite its position as a leading global mining company. The firm has a market capitalisation of £786 million, which implies that only more prominent companies can afford to bid for it.

Eurasia Mining is yet to receive a solid binding offer but clarified that it is in talks with potential suitors. The company’s shares are down 18% so far this year, and I wouldn’t be surprised to see it announce a potential bid in future.

The technical picture favours a breakout to the upside over the next couple of weeks, preferably supported by a positive fundamental trigger. Traders interested in the firm may find now a good time to buy.*

However, nothing is guaranteed in the markets, and I wouldn’t be surprised if a negative announcement drove the mining company’s shares lower.

*This is not investment advice.

Eurasia Mining share price.

Tradingview chart of Eurasia Mining share price 24-03-2021

Eurasia Mining shares have formed a pre-breakout structure after January’s massive drop. When will the shares breakout?

Should you invest in Eurasia Mining shares?

Eurasia Mining shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Eurasia Mining shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies

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