Trends And Targets

Superdry #Brent # Following Superdry’ somewhat funny shareholders meeting, we’d prepared a detailed analysis of the company potentials. But something (experience?) made us delay for a day, just to see what happened next as there was a single alarm bell making us doubt our optimistic stance. [Warning; teacher mode follows]

When a downtrend is as neatly defined as SDRY’s, a trend break which fails to perform flamboyantly is always a worry. Worse, and perhaps more importantly, if the share price closes below the point of trend break, we’ve learned caution is often a worthwhile stance.

SDRY broke the trend at 541p back on March 25th.

It failed to gain any real upward momentum, instead closing the session of April 2nd at 500p. Despite the BLUE trend line being at 499.375 and thus, the share remaining in positive territory, it was now substantially below the point of trend break. As a result, we dared not trust it.

Price moves on the 3rd April tended justify our caution and instead of an article devoted entirely to future positives, the share deserved something which reviewed both sides of the argument. Which is a pity, ‘cos seeing a BoD resign en-masse at the prospect of the company founder returning with the intention of saving the company was quite refreshing.

The situation now is slightly alarming. Weakness continuing below 433 looks capable of reaching 386p, hopefully able to generate a bounce at such a level. If broken, we can calculate bottom at 265p eventually.

The share price needs a miracle above 576p before anyone dare relax for the longer term, this level apparently being a trigger for recovery to an initial 750p with secondary, if beaten, a longer term 1079p.

For now, while a bounce at 386 looks pretty possible, we have a sneaking suspicion the price shall eventually bottom down at 265p. Perhaps it’s one worth keeping an eye on for the longer term.

3/04/2019 FTSE Closed at 7418 points. Change of 0.37%. Total value traded through LSE was: £ 7,236,665,904 a change of 13.48%

2/04/2019 FTSE Closed at 7391 points. Change of 1.01%. Total value traded through LSE was: £ 6,377,319,208 a change of 3.85%

Fevertree #DAX #NASDAQ As it’s spring, Tuesday (in our bit of Scotland) started with a covering of snow, along with ice covered windscreens. Adding to the cheer was our little tractor, devoid of a big back wheel, awaiting work on its brakes. Some days, share prices inspire similar levels of enthusiasm for getting a job done….

Thankfully, Fevertree does not join this grouping as the price looks capable of some continued movement upward as above 3190 now suggests coming recovery to an initial 3382. If exceeded, our longer term secondary calculates at a comfortable 3800. We’re mildly enthusiastic over this, if only due to the price ending its self imposed exile below 2950 and now closing solidly above its glass ceiling.

As always, we’ve spotted a fly in the ointment. (why would a fly be in ointment?)

The RED uptrend on the chart delineates closing prices since 2016. The inset on the chart illustrates how the price has closed during the most recent 4 sessions. Visually, the market is avoiding the share closing above the prior trend and this is always a worry. It appears growth cannot be safely assumed until the share price closes above the prior uptrend, presently at 3075p.

The problem we have with these games is fairly simple. Until the price actually closes above this trend, it remains trading in a region where weakness below 2470 risks reversal to an initial 1923. If broken, secondary computes down at 1196p.

We suspect it intends head upward, perhaps just awaiting some sort of news report.

2/04/2019 FTSE Closed at 7391 points. Change of 1.01%. Total value traded through LSE was: £ 6,377,319,208 a change of 3.85%

1/04/2019 FTSE Closed at 7317 points. Change of 0.52%. Total value traded through LSE was: £ 6,140,820,056 a change of -14.64%

Versarien #Gold #SP500 April appears to have started with positive feeling across the market place. Of course, it could be an elaborate practical joke by politicians, designed to obscure the slightly important detail they are failing to govern the country. Are they really voting to decide whether to have a vote about a vote? The TV show, “Yes, Minister” seems now a work of documentary.

When we last reviewed Versarien in February (link here), we’d speculated on the potential of them dropping to 62p. The intervening period highlights the share price “only” relaxed to 67p before exhibiting a reasonable bounce with the result, some optimism is possible for the future.

The immediate situation appears quite straightforward.

Price growth exceeding 120p should now make an attempt at an initial 125p. Visually, the price has form at this level, suggesting some sort of stumble awaits. Longer term, in the event it manages above 125p, we’re calculating a secondary at 145p, along with the potential for future game changing growth.

We’re pretty comfortable proposing a glass ceiling awaits at 125p, if only due to the whole bunch of folks trapped at this level since October last year and exercising common sense to bail at break even. This, alone is pretty certain to cause a stutter. Of course, there is also the bunch of folk who can draw lines, assuming the price is about to hit this mythical thing called resistance. With closure above 125p, we’d take this as early warning for longer term growth above the 125p “glass ceiling”.

The share needs wither below 100p to justify raised eyebrows, once again entering a weakness cycle with 60p calculating as the next target. If broken, it should bottom at 53p.

1/04/2019 FTSE Closed at 7317 points. Change of 0.52%. Total value traded through LSE was: £ 6,140,820,056 a change of -14.64%

Sheet Ice Thermal Extraction (ICE.A1) Just when Desire Petroleum was almost forgotten, a surprise IPO picked up on the infamous “Monday: The sample is OIL, Wednesday: Sorry, just water” infamous series of reports which pumped, dumped and ultimately drowned the Falklands explorer’ share price.

Apparently their first report was both right and wrong, thanks to some abnormalities in that particular region. The problem, it seems, is the Antarctic and icebergs which calve from the continent.

Sheet Ice Thermal analysis confirmed the original “faulty” oil/water sample as containing ice crystals, setting them on a hunt to confirm an obscure theory. The claim, now, is of icebergs calved from the continent actually containing pockets of oil, the very weight of the ice forcing sub surface oil reserves to leak upward into the ice. As the sheets make their way to the ocean, the pockets of oil become sealed, often sinking with the iceberg when it reaches warmer, less dense, waters in the Atlantic. They contend this resulted in Desire Petroleum “false positive” all these years ago.

The company, already floated in Dubai, aim to raise capital to conduct annual surveys of all icebergs leaving the continent, along with commencing extraction procedures. In addition, their aim is to revisit an old concept, insulating the surface of the ice with the intention of floating the massive fresh water berg to desert areas, finally realising the dream of turning deserts green while extracting crude oil during the passage. Additionally, covering the upper surfaces with Solar Panels will generate sufficient electricity to superheat sections of the ice and produce steam jets, effectively propelling itself at speed northwards.

This, perhaps, explains the excitement from investors through the Dubai exchange and results in a scenario where the forthcoming launch of Sheet Ice Thermal on the London exchange shall prove profitable.

We’re obviously a bit cynical, living in a world with just two types of ice; the clear stuff goes in your whisky, the yellow stuff in a certain relatives whisky.

Our inclination is to play safe, suggesting now above 24 Dirham should bring moves to an initial 33. Secondary, if (when) bettered, is at 49, along with the need to revisit our calculations.

The price needs melt below 15.40 Dirham to melt optimism for the future.

Finally, have a good start to April…

29/03/2019 FTSE Closed at 7279 points. Change of 0.62%. Total value traded through LSE was: £ 7,194,190,661 a change of 41.01%

FTSE for FRIDAY and Bakkavor! #CAC40 #US500 Sometimes I wish this was a video presentation, if only for the joy of starting with; “Hello world and welcome to another report from the UK Banana Democracy!” Glancing at worldwide media, the “Dead Parrot” sketch has international recognition and use, rehashed daily to highlight Downing St “plans”.

We ended last week on a throwaway comment, proposing a fairly serious reversal if the FTSE mangled its way below 7300 last Friday. The UK market achieved our proposed bottom, breaking it slightly, of 7164 points 8 minutes after the market opened on Monday morning. There’s little doubt the 136 point reversal was due to speculation about the UK’s political competence. The immediate problem for tomorrow – Friday – as the index keeps approaching the uptrend for 2019. Visually, any break now below 7140 points is liable to prove fairly serious, permitted reversal to an initial 7030 points. Secondary, if broken, is down at 6921 points.

The index closed Thursday at 7234 points, presently requiring above 7298 points to justify any rise being taken seriously. Such a trigger moves allegedly allows continued recovery to an initial 7315 points. Secondary, if bettered, calculates at 7370 which, unfortunately, was also the trigger level required last Friday to allow us to take any rise seriously.

Bakkavor (LSE:BAKK) On the subject of Banana’s, this lot immediately sprung to mind. Famous for devouring the UK company Geest, the banana kings, this Icelandic food group have been listed in London since late 2017, the share price coming very close to a bottom level, a point at which we’d expect a rebound. The immediate situation suggests weakness now below 115 should reverse to 107p, this being the point at which we’d hope for a bounce. Any rebound bettering 128 looks capable of moves to an initial 141p. If exceeded, secondary is a longer term 153. At this point, we shall require reviewing its future.

To be fair, the recent low of 110p was “probably” close enough to bottom, so it’s perhaps worth keeping an eye on them. As always, we’ve a warning. Below 107 and “ultimate” bottom is at 92p. We cannot calculate below such a point.

28/03/2019 FTSE Closed at 7234 points. Change of 0.56%. Total value traded through LSE was: £ 5,101,844,209 a change of -12.7%

Kingfisher #Nasdaq #Japan When the USA finally gets around to building its Mexico wall, they should consider Pampas Grass at a material. The stuff is capable of eating a strimmer, totally destroying a lawnmower, and even a ride-on tractor will grind to a halt when faced with this absurd weed. Unfortunately, it’s a weed which garden centres sell.

It’s nearly spring, and time for the annual battle against a garden.

All joking aside, Pampas Grass is actually the subject of banning orders in some US areas. While visually pleasing at first, the plant is a nightmare in gardens. Similar to Rhododendron, it’s capable of annexing entire countries. This rant, of course, brings us to Kingfisher’ share price and their habit of owning stores with garden centres attached. Currently doing battle with both species of ‘garden centre promoted’ weed up here in our bit of Scotland, feeling kindly to garden centres is an alien concept. Once we identify exactly what type of triffid describes a border, it can be certain we shall rant about it. We’ve a border plant which successfully defeated a petrol powered hedge cutter, along with an electric chainsaw. This year, it faces a 36 inch petrol chainsaw, along with a new cutting technique which may involve a naked flame.

The important number for Kingfisher is currently at 216p. Despite the price trading at 230 at time of writing, we view it as heading down to 216p. The danger flourishes if it trades below 216p, even on the first spike downward. In fact, especially on the first spike downward, thanks to technical reasons. Below 216p and we shall regard it as on a cycle to a bottom, eventually, of 142p. This is not payback for their advertising the weed as “Grass Decorative Plant, Small” but instead, the reality of price movement calculations.

An publicity picture of B&Q Pampas Grass, waiting to murder a strimmer.

To dig their way out of this mess, Kingfisher require grow above 295p, making movement to an initial 324p likely. If exceeded, the price is expected to flourish to a longer term 356p.

27/03/2019 FTSE Closed at 7194 points. Change of -0.03%. Total value traded through LSE was: £ 5,844,319,657 a change of 9.2%

Zoo Digital #DOW #CAC40 Accidentally cutting your wrist at 2am always leads to a fun household. A chicken pox issue, going since last October, left hard lumps, very itchy hard lumps. Absently digging at one, there was a realisation the “lump” was 99% old tissue which could be prised off. Then it started to bleed – a lot – an awful lot. Waking wife, clenching a wrist, oozing blood between fingers, tends elicit hysterics and questions.

Which brings us neatly to Zoo Digital, along with a warning about picking at wounds!

There is always the temptation to try and pick bottom with shares and Zoo, presently, are flirting with some very real danger. At time of writing, the share is trading around 46.75p. From our perspective, it dare not break below 45.5p as this risks uncovering a painful scab, a move with greater potential for self harm than we’d expect. For the purposes of certainty (or as close to such as the market allows) we shall demand closure below 45.5p as providing breakage of the final straw but to be realistic, alarm bells would now ring if this trades an iota below 45.5p.

The danger?

Such a calamity enters a cycle toward an initial 18p and hopefully a bounce with some integrity. If broken, our secondary calculates at a bottom of 2.6p, something which is visually absurd despite being mathematically possible. It is vanishingly rare for us to propose a price reversal to 1/20th of current and we’re not comfortable doing so. But there’s little doubt the share requires above 64p just to regain the immediate uptrend – or above 82p to regain the “real” uptrend.

If it intends a bounce rather than break the 45.5p, and rebound exceeding 64 should prove capable of an initial 86p, along with some visual safety. If bettered, secondary calculates at 101p.

It’s worth watching but, as with any other share, it has dangers. Our reason for mentioning this one is fairly silly. Sometimes, the market appear to notice a share price skirting the edge of catastrophe and reacts, extremely positively, to remain the share from danger. Perhaps some research will make sense.

26/03/2019 FTSE Closed at 7196 points. Change of 0.26%. Total value traded through LSE was: £ 5,351,936,484 a change of 6.29%