3500, I agree with much of which you’ve written, except that:
(i) breakouts are not confirmed uptrends and, technically speaking, buying at a breakout is considered more uncertain than buying into a confirmed uptrend. As you know, for the uptrend to be confirmed we need to see higher highs followed by higher lows. We haven’t seen that yet; we’ve only seen a breakout.
(ii) lagging indicators (including overbought and oversold signals) can be helpful which is why institutional traders often look to them. Rejecting them, as you seem to, might be likened to a fundamentals analyst looking only at the income statement and ignoring the balance sheet.
mithril, I hope you’re right. Unfortunately I just don’t see the commercial potential for the tech businesses in the same way. Perhaps I’m wrong; perhaps not. To my mind the facts as they are at this stage lean towards my version.
In any case, ZGL appear to have invested around 13m in them so far, an amount which is close to 20% of its capitalisation. That could have been one juicy distribution. Will they throw more money at them?
Relatedly, because the market places high values on other tech businesses, it doesn’t mean ZGL should also be valued like this. Different businesses, different markets, different management.
Good luck to holders.
ZGL Price at posting:
30.5¢ Sentiment: None Disclosure: Not Held
