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Hello Zand34,
Thank you for posting the SGQ monthly chart. Immediately one can see some interesting formations at play and as this is the only means of communicating with you, and hoping you don’t disapprove my copying and contributing some possible scenarios based on my limited knowledge of charting, I’ll outline some thoughts of possible forward developments on the chart based on anticipated exploration results. If you do not approve of my post, please feel free to alert the administrators at Hot Copper and ask them to have it removed.
I say possible forward developments on the chart because all will be predicated on the exploration results as they are released over the next few weeks.
Double Top
On your chart we that even though not exact, a double top has formed by the peaks of May and July and currently the hammer that formed as at the end of last Friday appears to have formed the base or resistance towards a reversal as you have predicted. It is interesting to note that this resistance / support level has occurred on some eight occasions since the third week of April. This level is at 12to 12.5 cents which as you have correctly implied may be the bottom. There also are no gaps to be filled below this level and with the plethora of anticipated favourable results t be reported on several fronts, I find it difficult to think of the price breaking this support towards the next lower level between 8.5 and 9 cents.
Triple Top
If all goes according to Hoyle and exploration results are favourable, the price heading towards the 23 to 25 cents level at which time there could be a pause developing with some profit taking place, culminating in the formation of a triple top.
Elliott Wave
The Doji cross that formed at the end of December 2015 as shown on your chart seems to mark the start of an Elliott Wave which has been forming over the last 10 months. Here we see wave 1 peaking at 25 cents in a Candle Wick (i.e. at the first high of the Double Top described above) in the second week of May 20016. Then wave 2 bottoming for the start of wave 3 at 9 cents in the start of July 2016, peaking at 24 cents in the third week in July. It appears we are currently in wave 4 and as you have alluded Zan it could be the support position ahead of the expected results. Therefore, this could mark the start of wave 5. There will be some zig zagging on the way up to top of wave 5 to form up to 3 or 5 sub-waves Their size will depend on the impact of news.
The Elliott wave rules state that Wave 3 is usually the strongest of the 5 waves and is never shorter than either waves 1 and 5. (i.e. one might be higher but not both.) - Waves 2 and 4 are corrective waves-
In this case, wave 3 is slightly shorter than wave 1, therefore wave 5 must be shorter than wave 3 if the Elliott Wave rules are to apply and if my observations and wave dissections are correct.
Again, with the anticipated news, we can expect wave 5 to at least reach the peak of 25 cents (the third peak of the triple top) and still be shorter than wave 3 before a correction takes place to complete the 1 to 5 cycle I described above. All this can be blown out of the Water if Super news comes out of Mt. Alexander or Ascalon/Windsor.
These are thoughts that I toyed with on this balmy, anticipation of rain, Sunday afternoon. I only have an interest in technical analysis but I am not expertly versed in the topic. I use it as another tool in my trading; my thoughts could be completely wrong. So please, to posters reading this, please please do
not take it as advice and use it to buy or sell stock. DYOR. I will say this however. Technical analysis is a fascinating subject and anyone trading the market should make it a point to learn a bit about it.
Thanks again for posting Zand34
I wish you and all readers well.
Helmenesh
