They have indicated that they will be appealing the courts decision but as an invester I’m inclined to think that they are just going through the motions by continuing the proceedings.

I have watched this stock for quite a while now. Seen it rise up and down on speculation and announcements but now it’s time for me to file it in the “penny dreadful” drawer.

Happy Trading.

There is a bit of an attitude going around that that recessions and booms are just part of the natural cycle of things and that one will automatically follow the other, much like the seasons. This of course is a a ridiculous notion as recessions and boom happen for reasons they don’t just happen. The current US recession happened because the fundamentals of the US economy were unsound, the huge budget deficits, imports far exceeding exports and a bloated housing market, all of which required unsustainable amounts of foreign capital to maintain.

So the question remains where is the recovery coming from? Have we learnt that although a consumer, service based economy is fun while it lasts it isn’t sustainable in the long term? Are we introducing new measures to increase productivity? What measure are we introducing to reduce our reliance on imports and increase our exports? Sadly I’m not sure the answers to these questions are anywhere near satisfactory enough to justify the bull run the market is on.

Cheers Craig

My prediction, it will be a positive decision and the share price could easily touch 4.5/5c during the course of the day. Obviously I don’t think that it will hold at these prices but if you follow the 45 minute rule (sell 45 minutes post announcement) then you could definitely get a very nice price. Of course if it tanks then waiting 45 minutes could send you broke.

I love these kind of announcement because it’s akin to playing at the casino. Roll the dice!!!

So, as one of my few remaining investments I wait. My gut feeling says that this company who have had a very chequered past have finally got it right this time and that this could be some very good news especially if the proposed capital raising is not a blatant cash grab for current holders or their institutional mates but rather brings on board a significant international investor that will give this company the breathing room to really develop and plan long term. Who knows…

Buy HAW @ 1.2 cents

Sold HAW @ 1.0 cents

Loss ~20%

Manage to create this loss in under 2 hours and learnt some more valuable lessons.

Lesson 1: Never trade when your primary trading platform is not working. I spotted this trade just minutes after the company released an announcement to the market relating to some good drilling results on one of their tenements. As news of the release filtered out and was picked up by traders the share price which has placed in pre open for the announcement was swamped with buyers. Some 60 million buyers placed orders and the match price for open started to rise fast. My trading plan was to get in at the open for 1.1 cents and exit at 1.2 minutes later. Unfortunatley my trading platform was having problems so the order had to be created manually and by the time this got done the match price had risen to my target exit price of 1.2 cents.

This is where I should have stopped. I had a strategy planned and altered it in the heat of the moment.

Anyway I decided to place an order at 1.2 cents and the order got filled at the open. I now adjusted my exit price to 1.3 cents and waited.

Lesson 2: Even on a quick trade always do your research. About an hour post open the share price was steadily rising with millions on the buy side and my sell order at 1.3 cents looked like it would be taken out within an hour or so. All good. Then a seller dumped 32 million share at market and pummelled the buy side down to 0.9 cents. The effect was two fold. Firstly it absolutely spooked the market and saw the buy side pull orders and secondly initiated a flood of sell orders at market. Literally in the space of 2 or 3  minutes the ratio of 2:1 on the buy side turned to 1:2 on the sell side. The only salvation was that I acted quickly and got my sell in at 1.0 cents before the close which got taken out before the share found a base at 0.9 cents.

After the my initial exasperation at what just occured, good announcement, massive build up, great volume I decided I would have a look through the company announcements for any information that may shed a light on what just occured. I found what I was looking for. Just a couple of months prior the directors of the company had dumped ~100 million shares on market after a good announcement. Nice one chaps.

It would appear the same had happened again. Basically the directors, by dumping (if it’s confirmed), obliterated any support for the share which has now fallen 10% off the pre announcement price.

Costly lessons to learn.

Happy Trading

As the rest of the market collapsed over the next six months it’s price continued to drop further, so it seemed to take twice the hit of other ore companies just for being the bearer of bad news. More recently it has renegotiated its ore prices in line with the deals Rio and BHP received (a 33% reduction). It’s mines are producing well with drilling done at new sites with expansion probable in 2010. Ore sales are continuing to increase after the intitial drop in the december quarter last year. I think it is a geniune business that it still undervalued by the market.

Cheers Craig

The company has released statements indicating that they are confident of the merits of their presented case and that they expect a judgement within the next 1-4 weeks. This is where it gets interesting. This share has steadily been climbing as indicated by the chart below:

To me the most telling indicator on this chart is the volume that has been built since the mid April spike. It looks like this stock now has some increased interest from investors and I’d suspect that interests is in the outcome of the Namibian court case on their Uranium play.

If the results of the court case takes weeks and drags out then I’d suspect some investors will be shaken off and a retrace of the share price could follow. If this occurs and the share retraces back to sub 3 cents per share then I like it at that price and may take a position. There seems to be some support at that level and it would allow a reasonable exit should the court case go against the company interests. Looking at the potential upside on this share, I would not be surprised that if a retrace occurs and the company recieves a positive result that the price could easily exceed the recent highs of 4 cents per share.

Happy Trading.

If you haven’t heard of SkyGrid it’s a startup aimed at traders providing a real time news stream that competes with services such as Bloomberg. If your a trader and a news junkie then this is one addictive tool. Breaking news from across the globe beams to the screen filtered and sorted by seemingly complex algorithms that group related news together allowing you to quickly cover the same news item from sources around the globe.

This is a godsend for individuals like me who 1) Can’t afford $500 a month for a subscription based service 2) Constantly trade with news websites open in the background.

Here is a screenshot

What do we manufacture in Australia that is exported globally and is a market leader? I can think of few pharmaceutical products and some small engineering plays but it would be a pretty short list.

It’s these truths that caution me against the current market bull run and whether or not it can be sustained in the short or long term. The credit crisis which brought down markets was a crictical structural problem and I can’t see how a recovery can form without major structural change. What have we done to change yet?

Happy trading.