Hi all,
Just some thoughts and a word of caution.
It's a good thing that new analysis show Banks will likely to wire back the impaired loans in H1，plus share prices moving up5%+ on Friday, but a few things don't add up at the moment...
Morgan research says nothing new... I would think The ANN of bank support on 2/5/16 is effectively saying SGH's loan would not be impaired, wouldn't it? Morgan report is analysis on the banks performances, although their analysis is valuable, I don't think what they said about SGH is anything "new". Only thing I consider "new" would be the full year financials, cash flows of the second half.
I think longs are looking for or wishing for an ANN hence anything coming to light will be considered that catalyst for SP to spring back to 90c or above, this could be dangerous and exploit by others... Why do I think this is the case?
1. Lack of follow through in buy volume after 2/5/16, it apears longs are out of steam and SP seems to be range bound with selling forces reappearing every time there is a peak. And given current market depth, anyone with some significant amount of cash can drive the SP up or down in a short time frame.
2. I saw on HC someone posted stats showing shorters reappearing, which counts for 5-6% of trades on 30/5/16. SP may be in danger given the up last Friday was with very little volume.
3. Given no real new information came to market, the real buyers i.e. The institution buyers may be restricted from entering, as my points above, I suspect they can't buy until FY financials are released or that SGH reenter Asx200. The Morgan report although reinforces going concern of SGH, doesn't have the same effect as the FY financials or the 2/5/16 ANN
4. On a lesser note, I see Alex also becoming positive on SGH, this conicide with shorter volumes going up... I suspect he may be onto something, maybe one big short before August 16? The guy said SGH was 90% a basket case pre 2/5/16, then he was 70% certain SGH was going to zero after 2/5/16, now that the Morgan report came out with nothing new or equivalent in significance compared to the 2/5/16 ANN, he now suddenly turns all positive about SGH? You draw your conclusion, also, what % is he estimating SGH to go to zero now to be consistent with he sudden change of sentiment?
Or I could be completely wrong and reading into this too much... I wanted to buy in at lower price, the above could be my justification to not buy at this level. Who knows they SP could sky rocket and I miss out even bigger, but I still don't think the likes of the Morgan report is sufficient to draw in major institutional investors, but rather it will draw in hopeful retail buyers who would jump in on any sign of news or seemingly "new" info that reinforces their believe.
I am a long too, but just want to buy in at lower prices... GLTA to all buyers and their long decisions on this stock. To draw a parrallel from WW2, I consider the FY financial to be the atom bomb that ends the "war" and SP finally entering clear up trend, but don't forget there is a "pearl habour" prior to all these... Or has the attack on pearl habour already been done with SP on this level? I truly don't know...
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Fy16 priced in, The transformational change will happen in a huge way 16 - 17, market will be looking forward shortly!!
