daytrades march 29 pre-market, page-3

This Weeks Picks

Market Direction: The last two sessions on Wall Street have seen sell offs into the close so I expect some caution will be evident in the market today. Offsetting this will be the larger institutional investors desire to keep prices high due end of quarter window dressing. The important economic data coming out of Australia this week includes retail sales and building approvals data on Wednesday at 11:30am. In the US consumer confidence figures come out at 1:00am AEST on Wednesday, the ISI Manufacturing PMI on Friday at 1:00am and then the all important monthly non farm employment change and the unemployment rate late on Friday evening at 11:30pm.

Sectors of Interest: Gold stocks should do well today with the price in USD up sharply to $1107/oz on Friday night against the backdrop of an Australian dollar which fell sharply to 90.25 US cents. The combined effect of these two factors pushed the Australian dollar gold price up by 2.5% so I expect plenty of interest in the sector today.

CVY: With a resource of over 1 million ounces at their Cameron Lake project and a potential [undiscounted] cash flow of US$156m from the initial open pit operations, I am surprised that CVY is still trading at 20 cents. One reason for the weakness could be that the institutional component of the recent capital raising at 22 cents has not yet been finalised so hopefully news on that front will come soon. The stochastic has just crossed up as has the MACD [but is still quite flat so watch for a stronger move up] and the RSI is rising slowly from just below 50. News Due: Drilling results from the Ardeen gold project in Canada. Completion of the institutional component of the placement at 22 cents per share. Disclosure: Holding CVY

BCN/BCNOA: With the Aussie gold price up strongly on Friday night I expect plenty of interest in the sector today. Knowing that assay results are due at any time should be enough to start attracting more speculative money into the stock from today. Technically the chart looks weak with the slow stochastic well below 20, the MACD falling and below zero whilst the RSI is flat. If the stock is going to show any strength into the upcoming assay results, then I would expect that strength to be apparent today given the environment of sharply higher aussie dollar gold prices. News Due: Assay results from the drilling program at the Barlee gold project. No Stock Held

SSN/SSNO: The cup and handle pattern which has developed over the past 6 weeks is still in play. However, for the pattern to remain valid we need to see prices increasing towards the breakout level of 3.6 cents today with a preference for a close of at least 3.4-3.5 cents. I expect a drilling update from the company this morning so provided things are proceeding well I think this move is entirely possible. The top of the right hand side of the handle is 3.5 cents; the breakout level [which would be a bullish signal] is a close at or higher than 3.6 cents giving a price target of 4.5 cents. News Due: Commencement of fracturing operations at the Gene#1-22H well due on the 29th March. Drilling update from the Ripsaw well. Details of the upcoming drilling program at Bakken. Disclosure: Holding SSNO

ARM: Interest should really start to build this week as drilling gets closer. Hopefully the company will provide shareholders with a more detailed update of the coming program shortly. Technically the stock is looking the best it has in weeks. Although the stochastic is heading up towards 80 I know it can remain in this territory for lengthy periods of time. The MACD looks like it is getting set to cross as early as today and the RSI is sitting just below 50. The Bollinger bands are now tight indicating there is currently low volatility which also provides a signal that a breakout could be near. The head and shoulders pattern looks less likely to play out meaning my downside target of 80 cents is now unlikely to be hit. A decisive break through $1.00 now appears to be the more likely scenario. News Due: Approval of drilling work program for the upcoming exploration on the Capricorn South East manganese project. Disclosure: Holding ARM


I had the pleasure of meeting many Hot Copper posters at the HCIII meeting in Brisbane on Friday and Saturday. Many thanks to all of the presenters. I certainly got a lot out of the sessions and plan to be a regular attendee at future meetings. One factor which became more apparent from discussions at the meeting was that most people have been finding the market hard work during the past month, so for those traders finding conditions tough at the moment, dont despair; you are not alone!

Best of luck to everybody with your trading this week.