daytrade diaries... january 18, page-2

Todays Picks

AQR: Further drilling results were released on Friday and the market was somewhat disappointed with the results, most likely because the grades lower down were not higher. Further assay results are due next week and unless they are better the price will probably continue to retrace, which is not that surprising after a run from 10 cents. News Due: Further assay results for the deeper part of the initial diamond drill hole 94D at the Whitewash South. Based on visuals these results should be good. Assay results from 95D and 96D are also yet to come.

PEN/PENOA: A research report by Hartleys came out yesterday with a six month price target of 10 cents. The markets reaction was immediate pushing the price up to a high of 5.7 cents. That was enough to confirm a breakout from the cup and handle pattern giving an immediate target of 6.4 cents (Height of the cup of 1.2 cents added to the top of the cup at 5.2 cents). I expect that target to be hit next week. News Due: Uranium resource estimates for the Lance projects.

ORD: There seemed to be a reasonable amount of selling yesterday with the price closing at its low of the day. The higher low is still in play as is a new uptrend provided the price doesnt fall too much today. Chart wise the stochastic and RSI have turned down but the MACD remains above the signal line. I will be watching closely for opportunities to buy back the shares I sold last week at the 5.8/5.9 level. News Due: Development plans for the Bauxite project in Laos. Commencement of ground EM surveys at the Copper Flats project.

MHM/MHMO: The settlement occurred on schedule yesterday and from Monday MHM takes over the Aluminium Salt Slag plant outside Geelong. It will take 26 weeks to complete the upgrade but during that time the plant will be running at 40% capacity. The company expects to earn pre-tax profits $230,000 per month (EBITDA). Resistance at 35 cents was tested yesterday and the price failed to break through and with the chart indicators turning down I now expect further consolidation around the 30 cent level before the next move up. News Due: An update on the Silica project (Wacker AG) is also due. Plans for exploration on gold and base metal projects in Tasmania.

NWE: The price moved strongly in the last hour of trade yesterday indicating some smart money taking a position in the stock. Given the last news released by the company was at the end of November I believe the market is overdue for an announcement. The chart looks good with the stochastic rising and the MACD crossing over. The RSI has also risen nicely to be passed the centre line. It is worth noting that volume was at its highest for a month. NWE will certainly be worth watching early this week. With a market capitalization not far above the NPV of their Puffin royalty there is plenty of room for upside. News Due: Exploration plans for North Perth Basin including possible farm-in partners for initial targets being Xanadu - 28mmbbls recoverable and Redhill South 7mmbbls recoverable. Analytical results from FTG and high resolution ground gravity surveys as well as reprocessing of seismic data at their Wessex Basin project in the UK.

OEL: Yesterday saw a major milestone achieved with BHP Petroleum re-entering the SC55 project in the Philippines as a potential farm-in partner. Once again this gives the project a lot more credibility. It is interesting that BHP were involved in the project but let the option lapse during the GFC due to the reigning in of exploration budgets. They have now committed to paying for up to 2,000 sq.km of new 3D seismic and will have access to all seismic data from which they can base a decision whether to commit to drilling two deepwater exploration wells. For this they will earn 60% of OELs 85% share in the project after paying back OELs exploration costs to date. A word of caution though it is an option to farm in only at this stage. All eyes move to seismic from now on. News Due: Results from analysis of the 590 sq.km seismic acquired over the Philippines project in December (Focus on Hawkeye structure 20-600mmbl). Acquisition of an additional 1,000-2,000 sq.km of additional 3D seismic over the SC55 project as a result of the BHP agreement. Gas production startup in Turkey.