From 23/05/2024 to the all time high (ATH) in late March, the SP rose 990%. From the ATH to now, it has dropped about 38%
Ignoring current pull back, the increase in SP since 23/05/24 is 590%
Importantly, the growth wasn't restricted to one day or one month... it was a steep, but month on month climb in SP with reasonable pullbacks along the way. That was a good thing.
But the ATH in March culminated in a 9 month long bull run. Bull runs are not indefinite, and the bigger the bull run, odds are, the larger the pullback/correction. Pullback/corrections after big upwards runs are healthy and necessary. It is a perfectly normal for any SP; to suggest otherwise would be illogical.
There can be many catalysts for such pullbacks/corrections. And lets be honest, since Jan 2025, there have been plenty of headlines for the market to deal with. Add to that delays in DFS announcements etc etc, it was only a matter of time before "a straw" would break the camels back in terms of the bull run (bulls/camels...hmmm)
The first signs the bull run might be over came on the 7th of April (formed a lower low after a long time)... perhaps aided and exacerbated by the DJT 'liberation day' fallout by 9th April. Second sign the bull run might be over, and confirmation of what happened on 7th came on 16th April (a lower high - i.e. failure to breakout to a another ATH).
By this time the AGM notes were out (around the 14th) and now the market is wondering if it should price in another CR. Last time we had a CR, SP price took a 42% hit. So it is reasonable to assume, the market is now pricing in the CR on a downward run.
The liberation day fallout makes it difficult to accurately weight the lower low we saw in April. If you take it as face value then the next lower low ( lower pivot point) might be 48c. Conversely, if we assume the liberation day unduly put its thumb on the scale, then the next lower low might be 58c(ish)...
I don't know if management was being devious or not... At least the price action has been predictable within reason in its behavior compared to tradable assets on the market.
Since there is predictability, I find it easier to deal with that over trying to explain SP by means which are less predictable in its utility for trading and/or investing.
To that end, I will keep some powder dry for the 58/59 mark and perhaps some if the 48c/49c eventuates.
LRV Price at posting:
68.0¢ Sentiment: Buy Disclosure: Held
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