Small Cap Highlights
Santa Fe Gold Corporation (OTCBB: SFEG.OB)
For
Monday, February 4^th, 2008

Tony Golan
Chief Technical Analyst
StockProfit.com™

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This week I chose to highlight the chart of Santa Fe Gold Corporation (OTCBB: SFEG). SFEG is reversing a long-term down-trend and starting a powerful new long-term up-trend, making higher highs and higher lows and is now above a rising 200-day moving average (the red line on the chart above). Relative Strength Differential (RSD), our proprietary indicator for selecting stock in super-strong up-trends, is well above the 25% threshold line, indicating the up-trend in SFEG is curently outperforming the S&P 500 and is therefore likely to remain strong.

SFEG hit its bear-market low in mid-December at 0.22, market as point 1 on the chart. From there, SFEG rallied well above the 200-day moving average and reversed its long-term trend back up, hitting a high of 1.00 in early January (point 2). SFEG pulled back, made a higher low at 0.70 at point 3, and is trying to turn back up now.

If SFEG can stay above 0.70, it is likely to continue the up-trend to higher highs. If it closes below 0.70, it will invalidate the up-trend and will likely decline back to the 200-day moving average. In the meantime, keep SFEG on your watchlist in case it starts to move up again.

Tony Golan
Chief Technical Analyst

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