Hi Folks
I haven't posted a TLG chart for quite a while. I am a chartist and can only read what the chart present. The charts can't predict significant news that can change a trend.
The chart is bearish
.* 10WMA and 40WMA are both falling with the 10WMA crossing below the 40WMA back in June (bearish)
* MACD, Stoch's and RSI(5) are negative (bearish)
* One three occasions (red downward arrows) the weekly Hi-Lo candle traded entirely below the 10WMA (bearish). A bullish signal is given when the weekly Hi-lo candles trade entirely above the 10WMA for a couple of weeks, It remains bullish until the bearish signal is give again.
.I am a holder and it bring me no joy to post this. I was expecting that when the mining and processing plant permits being granted would change the trend. It hasn't. I ignored my chart and put far too much emphasis on the news.
I did not take up the CR at $1 because of the chart for two reasons.
* Firstly because of this chart. Notice I have used the FIB to create the downward A-wave from 2.00 to 1.135, there was a 38% upward retrace B-wave (bounce) to 1.47, which is common. Once passing below 1.135 (no double low) the C-wave extention downwards comes into play.C-wave extentions to between the 23-38% level are common. Extentions of between the 38-50% range are not unheard of but are less frequent.So I have included on my chart a potential target area for this downward A-B-C pattern at the 23-38% range.
* Secondly. I have seen so many CR's across a number of stocks with downward trends in play. In a majority of cases the SP drops below the CR price some time afterwards. Why?
Because the CR dries up the number of buyers. Most people who got their shares a $1 are unlikely to enter the market place and bid for more, Fewer buyer means less upward pressure. Another factor is for those that set stop loss automatic sells at the 5-10% level below the CR price then exacerbate any significant downturn.
Many people will rightly ask why I am showing this chart now rather than earlier?
I may have influenced people not to take up the CR and then afterwards, if the Supreme court rejects the mining permit appeal and/or funding partners are announced and/or the first concrete off-take agreement is signed, I would be justifiably cursed because the downward trend could be changed.
To me the Swedish Supreme Court is a law unto itself. I can find no evidence that this decision will eventuate in a week, a month, six months or even a year.
Regardless of how much the Swedish government of even the EU jumps up and down.
When questioned when the decision will be made, the likely reply will be "In the fullness of time"
Just the way I deal with the markets so that I am not surprised by what plays out, As always DYOR.
cheers Lies
(20min delay)