Ann: Trading Halt-SYR.AX, page-135

Update from my last comment on March 16 (quoted comment) –

1/ Rise since then

As mentioned in my last comment, there was a potential of even a complete bottoming at those levels I won’t go into that again and have already explained in detail then and in my December comment in even more detail. My last comment on March 16 was probably one of the most bullish comments I have ever passed. I wasn’t entirely wrong and we even reached an intra day high of 3.14 yesterday. So, I can understand the optimism and hope of the bulls over last 2 weeks.

I specifically mentioned that SYR still needs to stay above 2.39 IMHO and preferably above 2.5 or the bulls could lose confidence again and that this IMO was a very crucial point. SYR played along beautifully with a small back test on March 17 with a low of 2.48 and SYR has never had a low below 2.5 since then - seemed like a great setup culminating in yesterday's top of 3.14

2/ Key levels

2.39/2.44/2.5; 2.64; around 2.8; 3; 3.2 (3.15 and 3.25); 3.45 to 3.53; 3.65; 4; 4.5; 4.72

Figures above are what I have been mentioning as key levels for months and months now and they have come true again and again and again.

I trust that I don’t need to go into figures of last 2 weeks but a quick look would show that we bounced against various key levels many times yet again.

Most obvious one was yesterday (30^th – Thursday) where open/high was 3.14 and low was 2.79, where 3.15 key level acted as strong resistance and 2.80 acted out as support on way down.

3/ Shorting activity on March 16

My last comment was March 16 which was bullish. I specifically mentioned the following –

“SYR’s best hope now is that they have covered yesterday and today. I don’t know if this happened and it might be good to check the chart over the coming days. Sadly, the
chart is updated with a time lag, but gross shorts could give some indication”

I noticed subsequently on the next day that shorters had more than 0.5% (red) day on March 16 too. I found that a little odd. You see, even on the day of the big rise which made me turn bullish, shorters were adding huge shorts. I did not point this information as I was hoping it meant nothing and was hoping that you guys have reached your long term bottom finally, and did not want to be the messenger of bad or even doubtful news. Maybe I should have pointed this out earlier.
http://www.shortman.com.au/stock?q=syr

4/ Short covering….or NOT!

Now take a look at the chart

Short position on Mar 15 – Ides of March massacre day – 13.21%

March 16 – Greatest bullish day – 13.15% - Does this not look a little odd that net short position is almost same. Shorts have been unmoved.
Since then, it has been getting even higher and higher and is 15.04% as of March 27 (Monday), and SYR is 4^th most shorted stock on ASX as of that day
http://www.shortman.com.au/top

Now keep in mind that this does not even take account huge shorts added on Tuesday, Wednesday and Thursday, and once this data is updated, if I was a SYR holder, I wouldn't want to see the updated chart.

Understandably, this should be a major cause of concern, and is a very high risk.

5/ Levels at which shorters piled on

I’m trying to understand the logic of levels at which shorters piled on. Earlier I mentioned at the start of March, they piled on big time in an attempt to probably hammer the price as soon as bullish sentiment had faded and the AUD 3 level was unable to hold. I specifically pointed out all this in earlier comments in this thread.

What about this time? –

March 16 – The oddest one of all, and shorters somehow probably wanted to keep price below 2.64 This is one of the most crucial shorting days and maybe I should have pointed this out earlier but I’m sure you guys would not have appreciated it. It is most bizarre that they shorted heavily on such a bullish day, and have not backed down ever since which obviously suggests that they believe that it was overvalued at that level itself.

Now note when they began to pile on again – when SYR was at the doorstep of 2.8 again and ready to more higher, and have never backed down since. SYR’s best hope is that shorters have covered today, or this could be worrying and especially in light of what I mentioned of shorting activity on 16^th.

6/ Importance of AUD 3

Although my last comment sounded very bullish, I ended it by saying that it would be interesting if bulls can actually follow through all the resistance levels including some really tough ones ahead – 3, 3.45, 3.65 and so many more after that.

I think I was spot on about that as SYR’s first major test has now come around 3. SYR did briefly make it to 3.12 on Wednesday but was more or less close to 3. Yesterday’s 3.14 was a deceptive start just to hit the resistance level and it came crashing down all the way to 2.8 because SYR did not pay enough respect to a very crucial level of AUD 3. I even specifically mentioned at the start of March about SYR failing the AUD 3 level earlier, and how that was crucial. SYR really needs to hope that last 4 days shorting activity was simply because of very crucial level and nothing more.

7/ Conclusion

I was hoping that my last comment on March 16 was the last comment I would ever pass on SYR and wanted to leave on a positive note.....

Hopefully, it still works out for you guys but if I was a holder, then I would be keeping an eye on the shorters’ data daily for clues. SYR does not want to start going down again.

Shorters activity is worrying and especially if they are planning on a possibility of taking on long term support levels at some point of time again. It is also a worrying sign that they never ever backed down even in the face of extreme bullishness recently. I clearly mentioned to you guys that IMO they were never ever squeezed earlier and we see now that they weren’t even squeezed in the face of such a powerful bullish setup but have gone all out with even more shorts.

SYR’s recent “positive news” was simply a “buy the rumour and sell the news” event so far.

Luckily, we are still at key support level of 2.8 which has held on yesterday and today.

As I mentioned, if I was a holder, I’d be keeping an eye on the shorts data daily, and really hope they start covering soon.

Good luck