IMO, Ithink we are still within Phase D. This may continue for some time until acompelling event occurs to push the price out of the current trading range.Phase E is marked by share Demand outpacing Supply. We are not there atm, Supply is still dominant and available.
Accumulationis still happening, Supply is tested all the time (each day is similar – open higherand then push down so that close is below open, day after day. Small volume,small intraday spread). Yes, we get some days in there which give false SOS(Sign of Strength) signals (higher vol, bigger intraday spread), but these arebull traps to try and entice new blood.
Shorts aresteady at 20ish%, they are waiting, frustrating retail, holding price back,accumulating what they can. Dangerous as the Supply/Demand dynamic might changequickly. Once one desk starts to cover, the price will accelerate faster andfaster as more join in the quest to cover increasing prices. I don’t think theyhave much ammo left to sustain large shorting to hold the price back if astampede starts (as available lending might be exhausted).
What is thecompelling event to set this off again – IMO – commodity price increase fromlack of raw material supply against raw material demand. Might be somediffering causes that set the demand stampede off, or a supply shortage off.
What am I waitingfor – increase in volume + increase in intraday spread + Supply/ Demand dynamicchange.
For thelast few months, average daily volume (ASX only) has been decreasing as thetowel is wrung to get shares out of frustrated weak hands (eg, from start Mardaily ave has decreased weekly 36M, 33.5M, 25.7M, 19.2M, 18.8M, 13.5M, 17M[trap?]) The behavior of the daily averages has been repeating since December. Theyare wringing the towel to get every last drop before cover starts, once startedthey can’t go back, it starts and continues until the next distribution point,or there might be an intermediate re-accumulation(s) points.
Currentlythere seems to be adequate Supply of shares for the Demand, ie. more sellingthan buying. Sell offs appear to me to be taking profit driven or those that must sell, rather than panic driven, anyway until this dynamic changes to limited Supply and overwhelming Demand, I can’t see the start of Phase E, or the required ‘true’ SOS.
Patience.It will happen (SP / Trading Range movement). These peasants don’t spend Billions of dollars shorting to not make and take profit at some stage, they have deep deep pockets, they are extremely patient, they are extremely intelligent and access masses of information that we are not privy to, they are experienced at doing exactly what they are doing, they will move when they are ready. Ride it with them. We are just sparrows. They will not beat me and I will outlast them!
Good luckall. I enjoy some of the posts (you know who are the contributors are) the restof the posts are nonsense and noise and the ‘Ignore’ gets a regular workout.
Disclaimeron above – Do your own research, the above is opinion only. Sorry about the formatting - HC doesn't like Word cut & pastes
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