Due to the strong bearish trend, the target price is fixed at GBp 3250 for Randgold Resources Limited.

From a fundamental viewpoint, the group is in a bad financial situation. Analysts have recently downgraded their forecasts for earnings per share. This indicator is often a precursor of a declining profitability and a worsening climate of investors' confidence. The valuation level is also relatively high with a P/E ratio at 21.84 for 2013.

From a technical viewpoint, prices are in a downward trend on all time scales. Moving averages are trending down and put pressure on the stock, which confirms this downward momentum. The breakout of the GBp 3751 support will be a strong bearish signal to continue the decrease toward the GBp 3250 support.

Investors could take a short position in Randgold Resources at the crossing of the GBp 3751 to target GBp 3250. A stop loss should be set above the 20-day moving average around GBp 3875, level that would invalidate our bearish strategy.