any positive news this week and we should head back to the 0.25 and FAST. One of the more difficult challenges as far as stocks or markets are concerned is to call time on an extended bear run. In the case of ECR Minerals it can be seen that there has been an extended drift since the through last summer’s double top through the 0.8p level. The issue now is whether the late May gap to the downside below 0.10p is an exhaustion feature and will enable the stock to deliver a long awaited sustained revival?
Not exactly helping build confidence here is the way that despite considerable bullish divergence in the RSI window from November the shares were unable to build on an extended positive oscillator support from the autumn to as recently as the beginning of March. Indeed, it was disappointing that the stock was not even able to recover the former July floor just above 0.3p before drifting away towards current levels. What can be said now is that we do have the backing of a July support line from last year running through 0.1p, and so far there has been a mild positive reaction from this area. Along with the latest batch of bullish divergence in the RSI window it can be said that ECR Minerals now joins the list of high octane recovery in plays that are certainly high risk / high reward in nature, although clearly from current levels the absolute downside is relatively small!
Depending on a traders degree of risk appetite, there will be entry now on the basis that the May gap to the downside is an exhaustion feature, otherwise it may be sensible to wait on either an end of day close above the gap at 0.13p / a break of the 50 day moving average at the same level, especially as this would also mean that there had also been a bear trap from below the former April 0.12p support. Either way, the initial upside here should be towards post-March resistance at 0.25p over the next 4 to 6 weeks - See more at: http://www.shareprophets.com/analysis/536/ecr-minerals-ecr-too-early-to-call-time-on-the-bear-run#sthash.c3gABCuL.dpuf
“The proceeds of the placing allow ECR to continue aggressively reshaping its business. Funding market conditions remain torridly difficult for junior mineral companies, and it is clear that any such company aiming to succeed must be creative in the way that it goes about sourcing and deploying capital,” revealed Clayson. The company is also looking to find a buyer or joint venture partner for its wholly-owned Sierra de las Minas gold project in Argentina. The company also has the possibility of taking advantage of some tax rebates owed its Australian subsidiary, Mercator Gold Australia, which is currently in administration, but it won’t get its hands on those until the administration process is finished.
What are other shareholders views here, surely this is due a big correction on the first sniff of good news?
Interesting end to trading here, a few buys (nothing compared to volume of late) came in and they bounced up the SP, would seem to suggest a tight supply from MM’s to the demand from the market. Hopefully a good omen as and when news is released, hopefully next week, but soon regardless.
Datafeed and UK data supplied by NETbuilder and Interactive Data.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk!
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.