All the traders who bought into CNQ once "the wall" at 12.5 came down seem to be trapped and will have to decide whether they want to become mid- to long term holders, or bail.
Obviously neither momentum nor good news was able to propel the stock to levels they had expected to achieve in the short term.
As a matter of fact the stock advanced from 10c to 14c (briefly), or 40% without any fundamentals news. Moves like this can not be sustained without being underpinned IMO. That's why the stock has retreated since. The management reshuffle was a non-event at best (well, we lost our managing director who did an excellent job during his tenure) and we don't yet know whether his successor will be able to advance the company with as much success. The LOI is no big news either since we still don't have a final contract signed and we didn't hear anything about a financing arrangement either.
To sum it up this week's news releases can not reasonably explain the 40% advance in the stock price that IMO has been driven primarily by the influx of hot money. I truly hope the company will meet its production schedule with first production to commence during February.
Regarding Ian's resignation I believe something really drastic and unexpected must have happened. If it had not, we would have seen a much more orderly transition.
CNQ Price at posting:
12.4¢ Sentiment: Buy Disclosure: Held
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