It looks like materials - precious metals to be specific - are back in favor, while auto parts suppliers are paying the price of an excessive runup earlier this year. At least that's the case judging from the charts of Northern Dynasty Minerals Ltd. (NAK), Seabridge Gold, Inc. (SA), and AutoZone Inc. (AZO). What other hints are their charts dropping? Take a look.

The only non-precious-metal name under the microscope today, AutoZone Inc. (AZO) looks like it's going to lose at least some ground, and perhaps a lot of ground.

The downtrend started with the peak at $170 in May; the bears haven't looked back since. AutoZone shares have made a steady string of lower highs and lower lows, forming a pretty tight down-trending channel in the process. That framework continues to guide AZO still, and we're assuming it will remain in the mode until further notice. If it does, Auto Zone shares are at least on pace to reach$136 or so... where the lower edge of the zone will be in a few days.

Longer-term, there's no telling how lone AZO could make this bearish ebb and flow pattern last. The stock flew from $90 to $170 in six months on no news that merited a gain of that size. That's a lot of excess to burn off, making the current pace of loss a bit anemic compared to the potential pace of loss.


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Northern Dynasty Minerals Ltd. (NAK) has thus far staved off what was going to be a bearish head and shoulders pattern, though the stock has yet to break out of the associated sideways range. The $7.64 area is the line in the sand. That's where the rally peaked today, just like it did in March and July.

Somewhat needless to say, if NAK can break above that ceiling, this metal miner could resume the uptrend started in October of past year.

Northern Dynasty Minerals toyed with highs around $13.00 last year. Assuming precious metal prices are at least as strong in the near future as they were then, NAK has a good shot of at least reclaiming that mark.


And finally, Seabridge Gold, Inc. (SA) is riding the same precious metal wave.... though without all the drama. 

Actually, SA shares look closer to the bottom of their bullish trading zone than to the top of it, suggesting now's a better than average time to step in. The stock recently pushed off the lower support line, and is on the way up. The fact that Seabridge Gold closed at a new multi-month high close today is just a little icing on the cake.

We're not setting a target or stop for SA... just ride the wave until that lower support line breaks.


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