It seems that some just called the bearish pattern wrong this time:
Market Outlook: It was definitely a day of high anxiety for shorts watching the sudden bullish move. The bulls now have the upper hand in the market. This bullish enthusiasm caught us off guard without the forewarning of a bullish pattern. Our previous SHORT signal didn't work out. This happens. Sometimes, candlestick patterns falter. We owe you an apology for that, but this is exactly what we have the stop loss mechanism for. The bullish stop loss of the last bearish pattern is triggered today.
Good to see the company strengthening its trading policy with regard to insider dealing. Also another expiry of options, 476,190 this time. Small amounts maybe but they are all shares that would count towards our overall volume.
�Current spare capacity is confined mainly to Saudi Arabia and we believe that the prospects for capacity growth elsewhere within Opec are limited � indeed some of the more peripheral producers (including Venezuela, Algeria and Ecuador) are likely to see output decline this year."
RRL will need to transform from a recovery stock to a fully operational stock before we find out what the markets consider to be fair value for RRL shares. Until then they will be subject to a lot of volatility due to the continuing uncertainty in the timing of the recovery and the trading games.
At the moment we have to be patient and recognise that the BOD have to do a balancing act until the water flood production comes on stream. They need to be seen to be actively drilling to keep the Trinidad Government happy whilst ensuring that they do not over extend themselves. Good cost management is essential.
Once the cash flow increases RRL will be able to ramp up the drilling campaign to increase production and proven reserves.
Of course the fact that they are using water flood will have the natural effect of increasing recoveries of all the reserves by 15% or more over all their proven oil fields.
Rather than guessing share price projections I prefer to wait and see what actually happens.
I like technical analysis but in this case as Malcy has pointed out for the last few months the company seems to be on a turnaround and starting to deliver which in time will translate in our share price. Sit back and enjoy the positive news flow.
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