today we have had cvi bulls insisting CVI would continue onwards and upwards to 20c today and beyond. There have also been some detractors claiming CVI was headed for 10c. Below I have included 2 charts. the first one is the 6 monthly for MPO. Whilst in an uptrend MPO made many breaks as CVI has just done. These breaks were invariably followed by retraces back to the MA line. MPO was a text book case of this as it bounced precisely off the MA line everytime. Unfortunately for MPO the subprime fiasco coincided with a major dilluation of MPO shares as they prepare to make the transistion from explorer to producer. Hence the downtrend as of late, I thought it best to clarify that point as the detractors may mindlessly start claiming CVI is about to enter a similar downtrend
The second chart is CVI's 3 monthly. It's not quite as perfect as CVI at bouncing off the MA. There have been a couple of minor breaches. But close enough. If you project from today through till 2 or 3 days time you can see that the riing MA and the falling SP should meet at 14.5c. I predict there should be a bounce at that point.
All the speak has been the same here as well as it was with MPO. The bull insisting the breaks would never end and were devastated by the retraces. All the bears rubbed their hands together with glee on the retraces and fell silent as the SP bounced.
The more things change the more they stay the same.
*disclaimer: my theory only holds in the absence of any new news in the next few days.![]()
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