Having finished the week with a nice lunch I have decided to amuse the grey matter trying my hand at thinking like a trader who's as cunning as a bush rat.
But before doing that I thought I should publish the weekend Shorting report.
Since Lachlan's resignation announcement and the start of the shorting 186 m shares have been sold/churned by traders over a 53 day period for an average price of 6.54 cents. Down from 7.9 c to 5.5 c
It seems like the Shorter is losing the battle to hold the price down now that the TA prophecy has been reached.
The bush rat trader.Honest Harry the follower ,when trading, would try to sell shares for more than he pays for them so needs to buy at the bottom and has been trained to use TA tools to help predict the future in an effort to know when the bottom is really the bottom and not just a false bottom.
I hope he knows he is playing in waters infested with Dishonest Dick and Tricky Trader.
Meanwhile Dishonest Dick the dreaded Shorter decides the market will view Lachlan's Resignation as potential bad news so decides to sell short which of course adds to the sell side and pushes the price down. We have seen from the posts on these threads that that was also accompanied by a campaign to talk the price down which successfully scared other people into selling.
The fall in price bought the principles of TA into play along the army of Tricky Traders who are on a mission to fool the followers by selling their trading stock to drive the price down in the hope, like the shorter that they will buy back at a cheaper price.
You can see from the chart that Dishonest Dick has had five attempts to get out since July 25. Everytime, in spite of him selling short while buying, the price has started to go up and he has had to build his short position back up
I'd say now that with the 5.5c line has been hit TA is supporting a rise and the Honest Harry has hit the buy button soon to be followed by Tricky Trader and and Dishonest Dick has got an own goal. and is stuck with buying at any price.
In my searches I thought the following describes well why our recovery will be brilliant, especially if the outlook section of the Half yearly report we get next week is as rosy as a spring garden and contains a whole year forecast ,which it should do, now we are back in production.
A reversal of the downward trend is caused by
*a clearing of short positions,
* investors believing the bottom has been reached, or
* investors that find oversold assets.
I think we are about to win the trifecta.
