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Jason4

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26/05/21

20:10

Post #: 53438907
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Originally posted by HOOPZ: ↑

Well the strength in the IO price did not hold and it has retraced significantly since the 13th of May (which was to be expected to some degree). This has had a very similar impact on the FEX SP. As an example, the 62% FE Fines June Futures Contract has dropped by 27.24% since the peak on the 12th of May while FEX has dropped by 27.07% from this date (highly correlated). It surprises me the extent to which the SP seems to be in lock step with the price IO given how profitable we are at much lower prices. Obviously some of the drop in SP will be due to momentum traders exiting and others taking profits, also the news and uncertainly surrounding China is obviously taking its toll.

From a technical perspective things are still looking pretty good (I'm sure some of you are a little worried - but fear not). We have had a retracement to the 61.8% Fibonacci level which is still healthy from a technical perspective (retracements beyond 61.8% can be indicative of a reversal and we are not there). I ended up topping up at 30c because I thought it was more likely to reverse at the 50% retracement level like it did between January and March at 20.5c (touching 20c a couple of times) - but it turns out that the 61.8% level was a better target. We haven't breached the long term trendline support - we are just touching it now - and given the inverted hammer candle for today there is a good possibility that we will see a reversal starting tomorrow. This might send us on the trajectory shown by the blue path. It is certainly possible that we might see an extended sideways consolidation between 28c and 38c until the quarterly report in July or some other news regarding JV and/or resource expansion - which is the type of price action we have experienced many times in the past. Another possibility is that we might fall off the support at 28c in which case there is some weak support at 24c and strong support at 20c. I think this red path is much less likely than consolidating above 28c as many existing holders will step-up and start buying below this 28c level - as such any detour below 28c likely to be very short lived.

The moving averages are still looking good reflecting the fact that the long term trend is still very strong. The MACD and Stochastic are still in the "sell" zone but I'm expecting a buy signal from the Stochastic soon (possibly tomorrow) which is a leading indicator and always turns before the MACD. Interestingly the RSI (highlighted with the red circles below) has moved below 40 showing that the SP is in an oversold range. Each time FEX has hit this level over the past 6 months this has proven to be a great time to buy - whether it be for a quick trade or a long term hold.

All IMO DYOR

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Seriously excellent analysis. Thanks for taking the time to write this up. Im a holder from 30c and reading this has made me feel quite comfortable.

FEX Price at posting: 28.0¢ Sentiment: Buy Disclosure: Held
9 Upvote

0 Great analysis

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(20min delay)
Last 24.5¢		Change -0.010(3.92%)		Mkt cap ! $176.5M

Open	High	Low	Value	Volume
25.0¢	25.5¢	24.5¢	$182.1K	731.4K

Buyers (Bids)

No.	Vol.	Price($)
8	61100	24.5¢

Sellers (Offers)

Price($)	Vol.	No.
25.0¢	101738	2

View Market Depth

No.	Vol.	Price($)
8	61100	0.245
28	724525	0.240
10	373382	0.235
12	426463	0.230
5	445842	0.225

Price($)	Vol.	No.
0.250	101738	2
0.255	287922	6
0.260	154791	5
0.265	247408	6
0.270	177467	5

Last trade - 16.10pm 18/09/2024 (20 minute delay)

FEX (ASX) Chart

Chart, page-1042

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Chart, page-1042

Top Stories

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