Trader's Cafe with Zak Mir: Bulletin Board Heroes August 16

 

 

Braveheart Investments (BRH): Key Reversal Up

Shares of Braveheart have made good on both last week’s fundamental buy signal of director buying (for a change) and the technical signal of a key reversal up off the lows. This was backed by a rebound off a line of support from July 2020. Off the back of all of this one would expect to see the shares head towards the 50 day moving average at 40p and possibly up as high as the 200 day moving average at 50p over the next 1-2 months. All of this is valid at least while the stock remains above a broken line of resistance at 27p on an end of day close basis.

BlueRock Diamonds (BRD): Extended 40p Support

BlueRock Diamonds can be said to have been bumping along the bottom for the best part of a year, with the key level in question in terms of support running at 40p. The latest break here of a line of resistance from February implies that the impasse has been broken, especially given the way that the move higher today has been via a sharp gap to the upside through the 44p resistance line and the 50 day moving average at 43p. A decent end of day close at 43p plus should be enough to take the shares towards February chart gaps at 54p and 58p as soon as the end of next month.

Cora Gold (CORA): 22p Triangle Target

It always feels somewhat brash to call a triangle target on a small cap, especially when it may be 50% or even 100% above present levels. However, in the case of Cora Gold a 20p plus target has been on the cards from even as long as a couple of months ago. It would now appear that the consolidation phase versus last year’s 15.25p peak is now over, something which would be underlined by a decent weekly close above this level this week. The timing of a possible 22p destination at the top of a July 2020 target is always going to be difficult, but suggesting 22p by the end of September does not appear to be too rash at this stage. Only sustained price action back below 15p really delays the bull scenario here.

88 Energy (88E): Building On June / July Gaps Higher

Both June and July saw shares of 88 Energy deliver as yet unfilled gaps to the upside, something which suggests that there is serious momentum behind the recovery. Although this has been a very volatile play so far this year, the implication is that while there is no break back below the latest 2.22p gap flow we should see the stock progress towards the top of the March gap at 3.05p over the rest of August. Above that for September the top of a notional rising trend channel from March at 3.5p. The ideal scenario is a retest of the 2021 peak at 4.5p plus early in the autumn. Only sub 2p for an extended period really kills the recovery pattern here.

i3 Energy (I3E): Broadening Triangle Ascent

Broadening Triangles are traditionally seen in the most bullish of situations, and in this we have every more producing oiler i3 Energy matching fundamental strength to the technicals. The triangle in question has been in place since December when the stock was around 5p. The December resistance line projection has i3 heading towards 18p as soon as the end of next month. The base of the triangle runs at 10p currently, and as little as an end of day close above recent consolidation at 11.5p should trigger fresh positive momentum. The rising 50 and 200 day moving averages moving up in parallel should provide further impetus to the bull argument in coming weeks, especially while 10p holds.

Kodal Minerals (KOD): Broadening Triangle Ascent

Another stock in the sought after broadening triangle ascent pattern is Kodal Minerals. Here the recent dip to test former May resistance in the 0.3p zone may have shaken out weak hands, but the sharp rebound since has only served to underpin the notion that this is a bona fide bull situation. Indeed, as little as an end of day close back above the rising 50 day moving average at 0.38p should be enough to confirm that the shares are on their way to the top of a broadening March triangle at 0.65p. While the timeframe for such a target as soon as the end of next month may be asking a lot, the set up here for the next 1-2 months does seem quite compelling. At this stage only sustained price action back below the old May 0.36p really delays the idea of 0.65p for early in the autumn.

Pires Investments (PIRI): Old Resistance / New Support

The decline for shares of Pires from 18p in March to 6p late last month seemed a little harsh even by the standards of pandemic investors’ rather fickle loyalty to even the most solid of situations. But at least it made sense from a technical perspective as 6p was the former September 2020 resistance zone. With old resistance now successfully tested as new support, and a break of a March resistance line at 6.5p easily achieved, Pires should make a beeline for the 200 day moving average rising at 10p. The fact that it is rising keeps the technical glass here half full and opens up the prospect of a retest of former May resistance on the way down at 13.25p by the end of September. The big picture target here could be the top of a broadening triangle at 23p, although one might have to give that a generous end of year timeframe – assuming a recovery in all things tech and digital in the meantime.