COMS (LSE:COMS) and Dramatics

Friday, 20th June 2014 08:32 - by Osakisushi

Sorry I missed a week but my wife has a big Golden Rule. If I want to work while on holiday, I can go and get stuffed… So I’m here in Brazil condemned to watch football matches other than doing something useful.

Dream on! I know two things about football. The ball is round and Scotland isn’t very good at it ‘cos they lost their ball.

COMS on the other hand is a bit mad. It was a share I used to provide a pre-market daily comment against but lost interest a few months ago when the price did something stupid.  Since thing, it has moved from stupid to madness. Lots of people who should know better state ‘You cannot chart an AIM share’, a laughable statement as they tend to follow trends regardless of those self proclaimed experts.

COMS is a case in point.

On the chart below is a BLUE line. For some reason the market thinks it important as, despite the price breaking above BLUE at the end of May, the share has been forced below it again and has carefully snivelled down the trend since. What does this tell me?

The breakout was either a mistake or the company shot themselves in the foot on June 9^th. I’d been showing a breakout target at 7.4p but the best achieved was just 7p before the price was smashed back under the trend and into the realms of madness. The reason for this was simple. Prior to the alleged breakout, I had a drop target at 4.6p and despite a breakout above BLUE, it made it to my target level anyway. 

This should not happen but it clearly did. It was almost as if someone else’ software had a box which needed ticked or perhaps someone had a Stop Loss level which was collected. Who knows.

What  we can see, clearly, is BLUE remains important to this share price with the result that movement now above 4.8p should give early warning of coming growth, initially to 5.7p with secondary, if bettered, at 6.35p. But for true growth, I’ll only be comfortable in the event of this now CLOSING above 6.75p as this created the fabled scenario of The 2^nd Breakout. In the case of COMS, it allows longer term growth to just below 10p.

But of course, if I’m arguing against a computer somewhere, I’ve a final tick-free box and it is at 3.15p. If this gets below 3.7p, that’s where it’s going next.

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.