Looking for opportunity in SLW

Love SLW. They are a silver royalty company that purchases production from various mining companies. They do not actually do the mining exploration and production themselves. I believe they have less than 50 employees. IMO, they minimize exposure to the perils that mining and exploration companies face with geo-political, currency, and labor issues. While most mining outfits have struggled back and have as yet achieved their all time pre-crash highs, SLW has out performed and made new highs.

Unfortunately, the stock has ran into an over-bought technical picture and presents risk for new long positions. A pullback appears to be in motion and would be very healthy for SLW and the precious metals complex in general. The idea is to consolidate and reset some of the indicators to a more neutral position, thereby allowing the risk to reward ratio to become a bit more favorable. RSI, stochastics, and price are showing divergence. A big gap is present on the chart and will most certainly fill. The beauty of this chart is that we can see a significant pullback to fill the gap (19.50) and even go lower, to the Fibonacci 38.2% retracement (18.50) and still not violate both the up trend and the breakout price level (17.50).

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