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Hi Dan,
It may seem like "mumbo jumbo", but a quick glance at any chart shows many support & resistance levels being revisited, without breaking for ages. Why so? Because unless there's a change in fundamentals, for example, from results, or we get surprise news affecting sector, a lot of market activity pays heed to TA.
It's not "sheep" following. More so it's powerful algos trading the TA. Majority of trades today are algos. These are set to take advantage of key TA levels. Charts reflect that. Those running these algos are powerful forces with billions at their disposal. Hence we can occasionally see seemingly irrational price moves playing out to TA indicators.
As others have said: fundamentals are important, but they represent only a part of the picture as to why we see the price moves we do. This applies to all stocks to a degree. I don't think of TA as gospel by any means. But it can be a very useful side tool. - Regards.
Thanks for some well-considered, quality posts from you. Excellent input! Mindful of your other time-consuming obligations, your time & energy genuinely appreciated, as usual. - All the best!
Seems that mostly a technical move has played out over recent days. As you all know, VOD's near 10-year closing low was 123.32 from 23rd May. Closing SPs tend to be more significant than intraday moves.
Today, as yesterday, 123.30+ retested again &, so far, it's held. SP 125+ as I write. Though still too early to be 100% confident, this could signal the start of a bullish reversal to higher levels. Let us hope so as we've all been through a hell of a time with this over recent months. No wonder a few nerves have been getting frayed.
GLA! - JD needing to focus on trading other interests.
"you could then argue that the purchase price in the first place was a little expensive"
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Poker,
Agreed. Argos cost £1.4 billion. Integration costs since then over £40 million. In perspective, less than the circa £46 million spent on the failed Asda merger, but still a lot of money overall for little obvious gain in the short-term.
SBRY closed at new all-time low today of 187.90, but at least the degree of falls seems to be slowing down as only a fraction below Monday's close. Could be a bargain SP for a L/T hold for the less timid. However, if I did add a 2nd tranche, I'd rather see a bottom & support established first, then buy at higher SP, rather than risk catching a falling knife. - Regards.
Hi Poker,
Thanks. Maybe it is "too early" to judge the Argos buy. But as a purely personal view: Argos seems so 1980s/1990s. On the increasingly rare occasions I see something there I like, chances are I'll find it cheaper on Amazon, with better delivery options. So I stick with Amazon. Haven't used Argos for years. However, some issues go beyond that.
Granted that this stock, as with other food retailers, can see decent bounces as soon as Kantar data improves, patently there's more amiss with the business than just overall costs of absorbing Argos, or the failed Asda-merger. With SP at new record lows, markets are sounding out warnings about further possible decline, if not yet alarm bells. By comparison, TSCO have upped their act by focusing on their core market.
Whilst markets can indeed be wrong occasionally, they're rarely wrong for very long.
That said, for me this remains a firm hold. Something easy enough for me to say as, unlike some, I'm not holding at very high levels. After trading it, I rebought at 215+ before the XD. Badly mistimed as it proved, yet very redeemable for another overall profit. Content to hold for a lot longer if needed. - Regards.
Hi Longish,
That would help considering the sharp slump in SP when Moody's downgraded VOD's debt earlier this year. Liberty deal clearance should be 23rd July. But mindful that EU ant-trust regulators have already extended that deadline more than once previously, that remains to be seen.
Next trading update 26th July. Gives me a few more weeks to again review any big decision, depending on VOD's SP in the days before the next update. - Regards.
Link I posted reverts to "auto". If you click on "auto", then "max", you get a chart for SBRY going back to before 1990. - Cheers.
"How can the share price be hitting new lows? lowest in 5 years??"
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RIck5,
I wish it was lowest in 5 years. It’s at an ALL-TIME low. Seriously poor. SBRY being outperformed by other food retailers.
https://www.marketscreener.com/J-SAINSBURY-9590189/charts/
I still hold & will continue. But question marks remain about running of the business. CEO Coupe has made some terrible decisions, not least buying Argos. It's been steady decline under him, bar the spike during the now dead ASDA merger. - GL.
Hi Longish,
I'd love to be wrong. But the way SP is behaving & with strong resistance not far above, it'll take VG news that's specific to VOD to take this out of the current slump. Can't see it.
Friday's 126.90 close was the lowest for a month. More decline later won't surprise me at all, no more than this site having further glitches & periods offline. - Regards & GLA.
Hi TLWilliams,
No surprise BB is seeing widespread disappointment here & folk letting off steam. Falling SPs are stressful for many holders. My remaining shares in VOD currently showing my biggest paper losses. Looking ahead, as long as VOD's SP stuck in tight range, the pressure likely to mount in weeks ahead. Especially if 123+ support is re-tested & falls. So much at stake on VOD's next update with a turnaround so soon seeming a very big ask.
Whilst nothing is 100% guaranteed, another drop in revenues & there's little question, IMO, of seeing new 10 year lows. Just realism.
By the by, wise to have sold out of IQE when you did 2months ago. No doubt IQE's reduced revenue forecasts yesterday was a shock, fuelling a huge exit. The reasons for it (US restrictions on Huawei, also hitting various chain supplies) may also concentrate minds on various uncontrollable macro-factors challenges across the sector, which may even impede the speed of take-up of 5G.
I post my live trades on ii's BB. Been busy with UKX. Also got lucky yesterday with IQE. Bought shares at 44.85, sold 53.01. That despite a technical gap left there from the previous close at 71.65. Preferred to book quick gains than risk a reversal due to the volatility with that stock. I still have smaller SB longs underwater in IQE.
Still hanging on here with my 198+ & 175+ share tranches as I'm not selling in 120s. Too much of a hit. But now bracing myself for another test of 123+, which is VOD's 10-year closing low from 23rd May. - Regards & GLA.
Hi Dan,
Probably so. Accuracy of these sites is questionable. From personal experience, I've had buys of odd numbered tranches go through & wrongly stated as sells on public sites. Not very often mind, but it's happened.
Of note, most trades are cited as automatic executions. Those will be via London Stock Exchange's SETS (electronic system). Some so-called "ordinary" trades, most of these after-hours, seem to be trades made via other exchanges & handled by market makers. But as you say, hard to be certain if they're actual buys or sells. - Regards.
Mikey,
Just looking at some of those after-hours (after 4.35) trades. We see a buy at 130.71, a sell at 127.44, among others. Hmm. Some of them could be very late reporting of earlier trades. It happens often. - Regards.
Hi Longish & Love_You,
VG points. I broadly agree, though I'm also more than glad to embrace change & new technology ONLY if it enhances my life. But in some respects I still prefer older ways. For eg. Books over Kindles. Vinyl & CDs over MP3 downloads. The internet has given all of us quick access to greater info, but also a lot of distortion & outright BS. In future, I plan to live 1 whole year without any internet or TV, before I die. Just to see how I get by getting all news from radio & newspapers, otherwise read books & watch the odd movie on DVD/Bluray.
I don't think we have a level playing field. Not for a long time.
Billions in QE since 2008's financial crisis to increase liquidity has only inflated assets & mostly helped banks, hedge funds, the seriously big money players. For the common people, it's meant historically low rates on their savings for much longer, leading many to take their chances on ever risky stock markets. Unlike to old building societies that offered decent saving rates, we know that markets offer no 100% guarantees.
Then there's the impact of high frequency algo trading, which gets ever faster due to more powerful computer systems. Most trades on ALL major global indexes are now algo-driven.
The thing I don't much like is how increasingly we see technology that seemed new not that long ago become obsolete. That process seems to be getting faster. As I linked to Dan a few days ago, China already going all out to get 6G out by 2030. So by the time 5G is the global standard, we could be looking at companies like VOD having to spend tens of billions again to upgrade to the next level & so on! - Regards.
"What an awful place the UK has become."
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Love_You,
I agree in part. Much of UK seems unrecognizable from just a few decades ago. But as with most new developments, aside from medical advances which are always a plus, there are pros & cons. Some of the worst cons include increasing number of predators active online & targeting vulnerable children.
More prosperous societies tend to embrace new tech before poorer ones, whose cultures tend to still be based on traditional values. That's long gone in UK. It's not just things like 5G, 6G, etc. New technology on many levels & increased automation will have a significant impact throughout society. Many more changes ahead. Whilst some of them will open up new opportunities, they'll render other things as obsolete. Not all change is always for the best. But we can't stop so-called progress. - Regards.
TLWilliams,
Addendum re that VOD spike last year. Occurred over less than 4 weeks. VOD SP 143+ on 9th November, 170+ by 3rd December. Then very soon fell away. Do I think such a price move will be repeated anytime soon? Most unlikely. But even a brief return to the 140s would be tempting for me.
That said, I may well follow your advice & get that new broker account opened very soon anyway, even if it lies idle for a while. - ATB!
Hi TLWilliams,
Thanks. Comment much appreciated, as with Gerry for previous mention. Your analogy with the delayed house sale seems apt. Sorry to read about your losses with that &, presumably, considerable stress to boot.
As Poker said, if one learns from these experiences, taking occasional losses, especially leveraged, can be turned into a positive for later. That's despite the 50/50 sense of disappointment & relief. But I continue trading UKX via leverage with consistent success, though I certainly won't be getting back my VOD hit anytime soon. Not this year at least.
As for opening anther broke account before move via a simple cash transfer? It's a VG idea. Something I've considered. But I've decided I won't be buying more stock with extra funds in current the macro climate, especially with a hard Brexit looking more likely this year. I really want to keep ample cash in reserve.
My abiding concern is if there was a delay in the broker transfer of more than 2-3 weeks & VOD's SP briefly spiked on low summer volumes, a short-lived selling opportunity could be missed. VOD's rise from circa 143+ to 170+ in early December took place within 4 weeks.
As mentioned to Alan, going by some reviews on Trust Pilot (1 star ones), my broker ii sometimes demand "proof of source of original funds" before allowing transfers to complete. Hence some delays of 3 to 4+ months. This requires providing evidence that may have long gone: for eg. old salary slips from defunct businesses & closed bank accounts, etc. Hence my delay until I settle a couple of things with existing share holds. - Regards & thanks again.
Catch all later as busy day out.
Hi Alan,
Not yet. I almost did, but then I decided to hold my VOD real shares a while longer after all (only sold the longs) & collect dividend (XD 6th June). Broker transfer still planned after VOD sale on any decent bounce, as accounts are inaccessible during transfers. That can last merely 2-3 weeks, or as long as 3-4+ months, depending on efficiency of the broker you're leaving. That's going by some 1-star customer reviews on Trust Pilot's site.
So leaving it a little while longer won't make much difference to me.
How about you? Initiated a broker transfer, or still waiting? Thanks in advance. Regards.
Hi Dan,
Maybe of interest. - Regards.
https://www.alphr.com/networking/1010192/china-preparing-6g-5G
Hi Trendfriend & Longish,
Thanks to both also. Your comments & time sincerely appreciated, as with all others. Many of us have been in a similar place, but my hit wasn't unexpected. Far from it. I was psychologically prepared. As in my comments over previous weeks, I'd been building up to it since results on 14th May if I thought VOD may struggle to consolidate above 131 by XD today.
On the plus side, I still have my VOD real shares (those much bigger stakes at 175+ & 198+), I've booked more yield on top of a significant amount previously, & the costly leveraged mess that incurred daily holding costs is now history. It's gone. As OFAH said, one feels a considerable weight lifted. One can now focus on other issues.
We'll see how VOD bears up over the next few weeks or so. Some key events. My hopes are tempered for a possible rally to at least above 140 over this summer, even if seasonal volumes may be smaller. Positive sentiment alone could drive it, especially on any positive EU decision on Liberty Deal by 23rd July. Otherwise, I share others concerns of some risk of revisiting recent lows.
Final comment from me for a while, but I'll keep in daily touch with this BB as I still hold a significant interest here. Regards & GLA.
Jack, OFAH
"Best of luck to you both.....put it all behind you and look forward to the summer.
I personally realised that you dont really learn to win at this game until you fully learn how not to lose....and that part is what we all have actually learnt from in this unexpected severe downturn in the Telecoms. "
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Hi Poker,
Thanks also. Sound advice, as for the rest of your comment. Live & learn, hopefully. Or face likely financial catastrophe with SBs. No hiding place in that domain as learning curve is steeper & errors tend to be punished severely if self-discipline lacking, or if there's too much ego & pride. That too has ben an issue in not taking losses sooner once key support levels fell.
FWIW, though it’s poor compensation that doesn’t even nearly cover my losses in VOD, I’ve taken hundreds of points profit from UKX since March, as posted on ii’s UKX BB. Thus, in future, I’ll focus all leverage trades there. It gives me at least a chance. UKX also pays weekly dividends. Occasionally over 20 pts.
I also think a break is due for me once I've deleveraged from a couple more stocks. One particularly vulnerable to heightened risks of a hard Brexit. But those hits combined will be much less than here.
Then it'll be just real shares held in various divi-paying stocks, with occasional trades & UKX for SBs.
But whatever happens with me, I know many others have suffered badly here, some holding shares from higher up than my 198+ & 175+. Whatever more I decide later, I sincerely hope all others get to see a VG outcome here over time. - Regards.
Catch all later.