RE: Whats driven the 10% fall today20 Feb 2020 15:31
I`m not quite sure why there`s so much hullaballoo about why the company released its statement, what it actually says, and why the market has reacted as it has!
Its quite simple, well some of it is, the fact that they felt the need to put out a preliminary statement when the full detailed on is only 8 days away is the only bit we wont be able to find out, but the rest is simple.
There is only one sentence that is important as far as todays reaction....
`A consequence of this strategy has been the need to push back the Company's UK roll-out plans for these platforms, which has resulted in the Company's financial performance for the second half of last year falling short of our initial short-term expectations.`
I knew straight away after the recent strong rise that the MM`s would take it down on just those few words. Its only a few words but for some its a world of anxiety..its all they can see and immediately think `profit warning` without actually reading the whole statement and putting it in to context.
The MM`s felt that they had to re rate the sp so thats why they gapped it down....its a shortfall in previously anticipated revenues, simple as that.
You know, well most of you reading this do, that they gave up the short term smaller gains to focus everything, time, money and effort on to the USA rollout in a matter of weeks from now...the big prize gains!
With the sp being gapped down, that then also throws some people in to panic and turmoil, some will sell thinking that the price is going to crash back to where it was a month ago, others will see it as a buying opportunity.
If the MM`s had opened the price at yesterdays close I would have tried to sell some as well, but only because I knew they would take the price down and there would be selling, it would have been a short term attempt to increase my already significant (for me) holding, without paying any more cash.
But they didn`t, they gapped it down so I just observed...because for me I also only read one sentence in the statement, this one...
`However, it is expected that this strategy will enable the Company to more rapidly exploit an accelerated roll out of our products, into multiple territories around the world, starting in the US from April 2020.`
It reminded me why I`ve been adding ever since the sp broke out of the long term falling wedge, and still very happy to keep holding.
We`re in a rising wedge now, and as long as the price stays above the lower line I stay in, or add on the dips if funds allow.
https://www.tradingview.com/x/cIgJsmp8/
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