You know the ship is sinking when even the bulls acknowledge it needs to be rescued.
Early this week I said we'd see 11c, and now at the end of this week I'm pretty sure we'll see 10c next week (unless we see a positive announcement, of course. The most likely being some sign of production ramp up). There has just been too many years without technical progress, and the recent moderate progress clearly wasn't enough to convince the market of much, and only briefly.
Management is also aware the ship needs to be rescued , it's not like I was the only one who could see 12c support breaking this week, and if they had news to do so they'd be announcing it.
11c support is not strong, the chart barely suggests 10c is support but being a round figure it's likely to be something of a barrier. Below that is 8.6c, which isn't especially strong support but I'd expect it to hold just because of how low the market cap gets at that price.
The market knows the can hasn't been kicked far down the road by the ATL deal, another CR is almost certainly required and will probably be announced next quarter. The market knows this. The bulls here can pretend the sell orders are fake, heck, they can even tell themselves the sellers didn't actually carry out any line wipes this week, but the market sees what's going on.
I'm honestly happy for AGY to announce production increase at any time, it would rocket the share price and I'd gleefully buy in and enjoy the ride up, but I'd rather bet on what's most likely.
Almost all trades today have gone through at 11c, the writing is on the wall for 11c not holding much longer. Looking at the daily chart the picture is pretty clear - look for support levels! If you zoom out it's even more obvious that the previous low will be tested fairly soon without news more positive than ATL providing a can kick and some dilution.
View attachment 6232716Actually, I'll include a zoomed out chart as well.
View attachment 6232734Looking at the chart, it's very interesting to see the peaks and consider which news caused them, how long the optimism lasted and how long it took for reality to kick in. Looking at the chart I'm really pleased I sold when I did! The continuous production announcement in April was mostly hot air (I'm sure some here are still focussing more on that than the lack of tangible positive news - it was bizarre to see people celebrating things like the fixing of a cooling system they didn't even know had been an issue or the routine maintenance of filter cloths, and vague implications without substance - here's a hint which will serve you in more areas of life than just investing: if there's a vague suggestion in what someone says without any solid backing, it probably doesn't actually mean anything if the person wants you to believe that message, they know you're going to be looking carefully for it, they know you want to believe it, they've had plenty of time to craft the message, and if they had any substance they'd be giving it to you explicitly rather than tacitly!). The ATL deal isn't some magical 'ATL knows everything so it's a bargain at 14c' - we see big companies take out small deals like this which go badly all the time all over the ASX, for all sorts of reasons. Whether someone in ATL simply said 'hey, it's only a piddly little $5M, if the company goes well and actually manages to produce 12KTPA we get dibs on some high quality product locked in at a low price, if not, oh well, it's only $5M and we probably won't even lose all of it, we can dump it in a year and should still get something for it' or whether there was some other deal going on, it doesn't mean ATL was putting $5M on the line because for them that's a huge amount of money and they're sure the price will skyrocket.
Anyway, we should see 10c this month, probably next week, unless production ramps up, which it probably won't. Happy to be wrong.
