Shifting Shares (27 August 2019) – Seller’s market #ALT #ASC #GKP

Shifting Shares (27 August 2019) – Seller’s market #ALT #ASC #GKP

I am certainly not investing capital in this market. There will come a time when the tide goes out, and it becomes a buyer’s market. At the moment, I would much rather be selling than buying!

Anthony Best Dynamics (ABDP)

We saw a brief sell off here, but the price has rallied. This is a sign of a good stock (not a good company – the stock price and quality of the business are two different things), and the sell off wasn’t on large volumes either. That shows that despite the market’s weakness, sellers are not in large supply – at least not yet.

The level still remains, and the trend is still intact.

Altitude (ALT)

Another stock that has not been hit hard by the sell off.

The stock has now bounced thrice off the 200 EMA, which is showing that there are keen buyers continuously around that level. So long as this level continues to hold, the bulls are very much in control here. I do hold a small long position here and see 118p as the key test. In my opinion, Altitude is worth a few hours’ of anyone’s time to research. The potential – if executed properly and effectively – is significantly large.

Arcontech (ARC)

Annoyingly, I sold a few shares when the stock broke the support level – only for a few days later the company to announce excellent results. That’s life, though, unfortunately. What would the alternative have been? Hold onto a losing stock and hope that it turns around? No thank you! I’m very much of the opinion that if you keep the losses small the profits will look after themselves – especially in a bull market where you don’t need to be Paul Tudor Jones to make a load of money.

The chart of Arcontech shows that there were plenty of keen sellers into strength. Stale bulls? So far, the company has come a long way.

You can’t blame someone taking advantage of the liquidity to unload a few if they were buying from 20-40p. In all honesty, I would definitely be doing the same.

Still, the trend here remains very much up, and I am happy to hold my remaining shares for now.

ASOS (ASC)

ASOS was a delight to short last year – and hopefully it can be a delight for us to short again this year.

We’re slowly grinding down to that level, after the shares rallied from the low. The price failed to break either of the 200 moving averages, which confirms that the trend is still down. If that level breaks – I’ll be short. We saw a similar pattern in SDRY last week, which I am still waiting on.

 

Blackbird (BIRD)

This is the old Forbidden Technologies who have now changed their name to Blackbird, because of their product.

Blackbird is actually pretty cool technology. It’s video editing technology that is hosted on the cloud with absolutely no buffering. It also has a bunch of other cool features which I’ve no forgotten about.

The CEO said that others have tried and failed to replicate this, and that to do so is very difficult (well, he would say that, wouldn’t he?). Unlike most CEOs, he has stuck his money where his mouth is and absolutely piled in.

My guess is that he is dressing this company up for a takeover – we’ll see.

I didn’t buy the breakout here as the stock has a nasty habit of gapping up and filling it. This time it was a breakaway gap and has done fantastically well. It’s moved well above the trading high of 8.5p and now this is a stock that is in play. Let’s see how well it’s bought after the run is finished and it may offer a setup for a trade again.

Capital Drilling (CAPD)

This stock has now broken out, but given the market conditions and illiquidity it’s not one I am going to trade. It may be one for fundamental long term trend followers to examine, but not for me. Volumes are just too small.

Glencore (GLEN)

This is probably not one you were expecting to see here, but the chart is interesting. I do follow GLEN and AAL as miners tend to set the pace, as well as BP and RDSB.

This chart does not look great.

It’s well below all moving averages, trending lower. There is going to be a short trade setup if the price takes out the double bottom.

Be careful though, GLEN is a serial gapper. It loves a morning gap up or down – so position size accordingly to take on that volatility if you’re going to trade it.

The fact that both GLEN and AAL are well off their highs and printing lower and lower is not great – it’s a signal of market weakness in my view. Therefore, I will continue to be not putting so much capital at risk and trading the short side of stocks.

Gulf Keystone Petroleum (GKP)

Some of you may be experienced enough to remember the GKP story – it’s now a vastly different company from what it used to be.

The chart is putting in one big wedge too.

The stock has not made a new high since last July, and has slowly consolidated as the stock finds its equilibrium point.

I would be tempted with a small long on a break of this wedge, with the view of adding again as it took out the 2019 year high. I do quite like this stock – it generates large amounts of cash (check the monthly Shaikan payment RNSs), but it’s not without risk. That is probably why the market is rating it as cheap as it is, with a PE of 8 according to SharePad.

In a world where bang average businesses are trading on 15x+ earnings for EPS growth well below that level, that doesn’t seem so bad. Still, it can only ever be a trade for me.

That said, I am certainly not investing capital in this market. There will come a time when the tide goes out, and it becomes a buyer’s market. At the moment, I would much rather be selling than buying!

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