wow what a week, page-72

Thanks Mitta and Funky for your responses, I learnt a lot. I hadn’t picked up on that back-test at $1.13 on 4th Jan, but it just reinforces my perception that this trend line has been pivotal to the action and will continue to support the price.

Mitta3 I can see you’re quite the technician, and yes I should have been referring to an ascending triangle. I also hadn’t understood that once a trend line or pattern has been broken then it’s no longer valid. However, I’m not yet convinced that TA always follows the text book and having lived this stock every trading hour for the period concerned because of some significant money on the line, I intuitively believe that trend line can’t be discarded.

I’m also of the view, rightly or wrongly, that why TA works is partly its ability to measure underlying sentiment, but also partly because it’s self-fulfilling. When every professional trader has sophisticated software, is trained to look for the same patterns and respond to them, as well as bot-trading which presumably is pre-programmed to established trading rules, then essentially what I think occurs in the market is that something of a consensus emerges. In the short-term, the professionals all know the trading rules, signal and test their intent at key technical points, a consensus forms in response to the price action and volume and the big money follows in predictable patterns. The amatuer investors get left asking why. For this reason I expect that the simple and more obvious trading signals such a trend lines and resistance will be most effective to guide trading, but I’ll figure this out over time.

Anyway, I considered both your advice, I hesitated, umm’d and ah’d, tossed it all around, and then.. bugger it.. I went and bought some warrants today to further leverage long on that trend line support holding, assuming more delays with the POL outcome (TA won't matter if a final decision is made either way). It will be very interesting to see how this plays out. I guess I’ll get an expensive education in TA if I’m wrong.