HCH Chart, page-2002

I thought I would try and take an objective view of the chart prior to going into trading halt. The breakout in April triggered a buy using the Stan Weinstein relative strength system. A price breakout on volume beating the performance of the all ords brought the share price back to the $1.25 resistance area. Note the previous time this model signaled a buy was one year earlier in April 23 following the release of drill results at Cortadera. That turned into a pump and dump and the stock fell back into its sideways range. The stock also rallied in April 22. Maybe the time to own this stock is in April.

So the capital raise is announced as the stock consolidates its recent break-out back up to the strong resistance area of $1.25. Technically, the chart has been setting up for a potential break through that resistance over the last few weeks. Whether that would have been on this test (as shown in the green path) or after a retrace and on the next test who knows.

Now that we know there is a capital raise and a suggestion of a SPP at $1, it is reasonable to expect the stock price to retrace from resistance and for a further shakeout to occur below $1 and perhaps resistance again at $1.25 before breaking through and upwards towards $1.50 which is when the options will come into money.