Forum Archive Index - July 2001

["openmind" <openmind@paradise.net.nz>]

Phaedrus, many thanks for the charts that you have provided and I agree that they are a very worthy tool in investing and trading.

 

Certainly ITC's chart shows a significant down trend and has broken through the downside resistance of 16c.

Insider info on Terabyte dampened the share in March, through May and Streamlink rumors have been floating around for quite a few months now which hasn't helped and often cause this type of capitulation as it puts a deep chill into the psychology of investors.

However in the case of ITC I believe that an extreme over sold situation is now in place, and the sea of positive info linked to it's other investments will have an immanent impact on ITC's share price.

This will most likely start to happen when the annual report is due to be released which will be very soon. It will most likely contain current market values for DVI and Virtual Spectator which will show substantial increases.

The reason this will happen is because ITC want to raise more capital to put into both of these outstanding investments, and will only be successful in raising capital when the share price is reflecting it's true NTA value 28c+ IMO and that's without any premium built in, which is to be expected in the current state of the world equity markets.

 

ITC's chart is not unlike RMG's that was in a down trend from August 2000 35c with a final capitulation during march this year (17c) after breaking below it's downside resistance of 25c late February 2001. All this was driven by insider info that frighten the hell out of investors who jump on the down hill run, and look what happen shortly after. Within 8 weeks the share price is back up to 23c (+35%) and breaks through the then upside resistance of 25c and peeks at 33c (+90%) within another 3 weeks.

 

When every one is jumping ship and the overall info is that a company is mostly making excellent progress and a capitulation has happened we need to reverse our natural psychology before the crowd. It's always a tough call so please consider all the facts as they are relevant.

 

Yes I know Phaedrus you would wait for a chart to develop a new up trend and thats playing it ultra safe and I respect your reasoning for that, but in the case of RMG that would have been 26 to 27c and one would have to ignor other evidence of a grand buying opportunity.

 

 

P.S Phaedrus, I thoroughly enjoy your Learned imput to sharechat technically speaking.

 

 

Regards openmind.