I posted a week or so ago that I've recently been learning to read charts for my personal knowledge building. The more I've researched about them the more I've come to realise that charts really do have a tendency to repeat themselves. Ofcourse not always, absolutely not. But if similar patterns emerge and similar scenarios align in the market the chances of repeating do increase.
I've had another look at the NSL chart and have noticed that in July 2016 when we were around the same price we are now we were there for a couple months and then ran up to nearly double in price in a short timeframe. At the same time we were getting news regarding the phase 2 dates and were starting to see progress towards production later in the year.
The next time we were back to these levels was around July 2017 to September 2017. During that time we had a lot of newsflow about sales, thickener circuit and the investment by First Samuel in to the company. We had a short lived run up of about 40% increase in SP.
Now we've been back to the same (admittedly slightly lower) SP levels since mid November and have had updates regarding production expansion, JSW purchase order and COO loan being repaid. We've just had a spike in volume (still low volume however much larger than average for the last while). We also expect newsflow regarding further expansion plans, ofcourse the quarterly for cashflow update and what else? Who knows.
On all 3 occassions at these levels we had positive newsflow, the average timeframe we hovered around this SP was 7-9 weeks and what followed was a sharp increase in SP. If the quarterly provides a positive summary of the last quarter and newsflow continues for phase 3 this will be the perfect storm for the SP to run up again, however this time I wouldn't expect the SP to retrace as far as it has since Dec/Nov 2016.
Please know I have
very little experience in predicting short term movements, I'm absolutely in it for the long term and the fundamentals are super. Charts and short term outlook has just caught my interest of late.
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