There are two main reasons why I believe significant news is very close for RTL which ultimately could be the catalyst for a major breakout on the chart; firstly the massive premiums paid on the recent placement price and secondly the significant increase in daily trading volumes over the past 4 trading sessions.
RTL Corporation is reviewing a number of potential new projects:
"The Company has reviewed a number of potential new projects during the period, and continues to do so. Projects reviewed have been in a variety of business and geographical sectors, some of which are complementary to RTLs existing operations and some of which would likely result in a significant diversification of those operations. As at the date of this Report, RTL has not entered into any binding agreements to acquire interests in any new projects."
◆ DJ Carmichael was the lead broker for the recent placement at 0.5cps (11th February)
◆ DJ Carmichael facilitated an 8,278,607 on market purchase at a massive 260% (1.8cps) premium to the placement price (24th February) - Interestingly, it was later revealed that an RTL Director was responsible for the selling
◆ More than likely the buyer for the pre-arranged trade was aware they were purchasing directors shares and the VWAP for the above time period was used to determine the transaction price
MY SPECULATION...
The question remains why would DJ Carmichaels (as the lead broker) pay a 260% premium to the recent placement price and facilitate the purchase of over 8M Directors shares?
If RTL decides to significantly diversify its current operations it will need directors that suit the new business direction. This being the case the 2 Directors who recently sold may be moving on and were required to sell prior to RTL announcing a change of direction in order to avoid any accusations of insider trading by selling after the fact?
RECENT TRADING
Massive accumulation and up to 480% price premiums paid (compared to the recent placement price) IMO suggests that this project will be big. The significant increase in daily trading volumes over the last 4 trading sessions IMO also suggests that news is close. Despite the eager buying again today, impatient day traders seemed responsible for the minor sell down...
Major resistance at 2.9cps is proving hard to break and may need news to do so? Ultimately, if this level is broken along with minor resistance at 3.2cps the chart offers enormous upside potential as the next target is a historical gap up to 8cps. Fingers crossed that news can fill this gap!
JB
RTL Price at posting:
2.6¢ Sentiment: ST Buy Disclosure: Held
