#SP500 #Japan When we last covered this potential disaster (and dodgy chart pattern) in May (link here), nerves were expressed regarding the share price future. A hopeful bottom of 82p had been designated as important, essentially as further drop potentials were really quite messy. In fact, 28p and less were mentioned as further drop targets!
Without a doubt, things have now gotten messy with the loss of their Chief Executive, a large pre-tax loss, and reportedly large numbers of customers unplugging from the company. Thankfully, their CEO was awarded a 44% pay rise in the last year, an award which will doubtless work wonders for staff moral within a company frantically attempting to put a positive spin on a pretty rotten day on the markets.
The situation now is dangerous but we are able to offer a slight glimmer of hope. The immediate situation suggests ongoing weakness below 73p should find its way to 63p next and hopefully, exhibit a bounce. Once again, we advocate extreme caution of 63p breaks as any bounce is liable to be short lived. Instead, there is the potentials for freefall down to a bottom (hopefully) at 28p.
In our opening paragraph, we mentioned a “Dodgy Chart Pattern”, something easily missed as it covers the period since 2003. The chart below shows the price has experienced a painfully clear Double Top from 2003 to 2015. Some people swear by this sort of thing, most people swear at this sort of thing but there is always the risk of Pattern Believers creating a self fulfilling prophecy. In the case of Centrica, it calculates with “Ultimate Bottom” down at 12p. We suspect most folk will be happy to fill up with Centrica shares if it ever actually achieved such a ridiculous number but, in the grand scheme of things, our own potential of 28p is pretty blooming close.
To get out of this mess, Centrica needs exceed 108p at present.
|
Time Issued |
Market |
Price At Issue |
Short Entry |
Fast Exit |
Slow Exit |
Stop |
Long Entry |
Fast Exit |
Slow Exit |
Stop |
Prior |
|
9:48:50PM |
BRENT |
64.93 |
Success | ||||||||
|
9:50:57PM |
GOLD |
1431.01 |
‘cess | ||||||||
|
9:52:55PM |
FTSE |
7650.76 | |||||||||
|
9:56:15PM |
FRANCE |
5499.7 |
Success | ||||||||
|
10:04:17PM |
GERMANY |
12130 |
Success | ||||||||
|
10:05:46PM |
US500 |
3014.07 |
3000 |
2996.5 |
2986 |
3014 |
3017 |
3022.5 |
3030 |
3006 |
Success |
|
10:12:17PM |
DOW |
27229.8 |
Success | ||||||||
|
10:19:02PM |
NASDAQ |
7976 |
Success | ||||||||
|
10:20:49PM |
JAPAN |
21509 |
21476 |
21457.5 |
21350 |
21535 |
21609 |
21643 |
21702 |
21542 |
‘cess |