Vela Tech. Technical Analysis (04/01/2016):

Disclaimer: I don't have a licence to distribute financial advice, etc.



Happy New Year!

My proprietary charting software is throwing a wobbly with my Mac's latest update, so these are Yahoo Finance charts:

Zoomed in:

• In this zoomed in chart, the most encouraging upside technical argument is the break of the upper Bollinger Band and the companying upwards implied surge in volatility.
• The relative closeness of the daily close to the upper band is a positive sign as it suggests a smoother run to the upside over a longer period of time as opposed to a short term price spike.

Zoomed Out View 1:

• The first of our zoomed out views helps to illustrate the lack of price resistance to the upside from the current levels. This helps to create an environment where there is little to stall a sustained rise in the share price for the current levels.
• After the break of the small amount of resistance at 0.275, the next resistance levels are placed at 0.35, 0.45 and 0.52

Zoomed Out View 2:

• I've added an RSI here as I am aware that many traders on the AIM use this as an indicator - in my experience, the RSI can be very overbought or oversold in any direction for long periods of time in the micro cap stocks - the lack of algorithmic driven trading plays a large part in this.
• While I don't personally use the RSI in my regular trading activity, the movement through the 50 level is especially encouraging as it corroborated the upside bias expressed in my above Bollinger Band analysis and suggests more upside potential from these levels.

My conservative shorter term targets would be ~ 0.52p resistance level, with the sky being the limit over the medium and longer term as news flow begins to blossom into the new year - the 3D TV investment is particularly exciting, in my opinion!

The only potential downside I could see here would be if any fundraising was carried out (which I highly doubt, because they had at least six figures of cash when I last did a fundamental check) at these levels.

Enjoy,

The Masked Stock Trader

Technical Analysis Jubilee Platinum 21/10/2015

I have no licence to give financial advice, etc

I found JLP the other day while running wider technical scans and was surprised that my pattern finding software hadn't pinged this as being a bullish symmetrical triangle. 

On further research I have determined that this may be more likely to fall under the technical parameters of a Hunt Volatility Funnel (HVF), which is very similar, but focusses more on the idea of having three lowers highs, three higher lows and a major trend being in play.

Currently the daily trend is upwards, meaning that we can expect on a balance of probabilities for this pattern to break to the upside (HVF theory encourages the idea that markets tend to continue in the direct they're going in rather than turn around).

To project a target from this pattern we have to do the following:

Find the first major high (August) = 5.45p

Find the first major low (September) = 2.8p

Find the mid point of the triangle (the two numbers above) = (5.45+2.8)/2 

                                                                                               = 4.125p

Difference between first major high and first major low = 2.65p

Price Target on upside break = Triangle mid point + major high major low difference

= 6.775p (implied upside of 78% from the current share price - 3.8p).

I went long here a couple of days ago ~4p and will continue to add to my holding on further dips as the news catalyst we are expecting (debt funding news) is expected imminently.

Here is a fundamental look at the company that I put together:

http://themaskedstocktrader.blogspot.co.uk/2015/11/jubilee-platinum-short-analysis.html






Enjoy,

The Masked Stock Trader

Beware of "Institutional Holdings" Trackers - Quindell

Morning all,

A quick post from me to show how we need to be careful of websites that claim to track institutional buying/selling in equity markets.

e.g.

Reuters has QPP's institutional holding level at 20.44% with a net three month change of 26,621,650 shares (90,932,273 shares held in total by institutions):

http://www.reuters.com/finance/stocks/financialHighlights?symbol=QPP.L

Morningstar has this figure (by my calculations) at 10.17% (45,295,100 shares in total held by institutions) and, that i can find, doesn't even mention the recent Beach Point Capital purchase:

http://investors.morningstar.com/ownership/shareholders-concentrated.html?t=QPP&region=gbr&culture=en-US&ownerCountry=USA

Conclusion: Reuters is probably a better resource for this institutional holdings information (this opinion was seconded my my mates in the city - although nothing beats seeing the actual register).

Cheers,

The Masked Stock Trader

Gulf Keystone Technical Analysis Update

I've been calling a move to the upside in Gulf Keystone Petroleum (GKP) for a few months now, but it's taken a little longer than I expected for the company to begin this process. Nevertheless, it seems to me that the breakout is now on (again...)!











































The key indicator here is the 50 day Simple Moving Average (50 SMA), which has been a consistent obstacle to any rally in GKP over the last year. In fact, the stock has never held a move above the 50 SMA for more than two days until now.


I have a slow stochastic and RSI on my chart above, but I would recommend ignoring them, as historically they've both had worse that 50% accuracies when it comes to picking GKP's future price movements.


Current major resistance levels are at:

40p
41.2p (100 SMA)
42p
52p


These factors combined with the latest fundamental news that the company is beginning to be paid by the Kurdistan Regional Government for its exports gives a positive backdrop to the improved technical situation.


The next catalyst for an expansion in volatility here is the expected CPR on the Akri-Bijeel oil field, that GKP hold a 20% stake in. If this (as currently expected by the market) is revised up, this could be another reason to be bullish on the stock.


With the news that the data room was to be closed at the end of the summer, there is also a chance that we may begin to hear news on the M&A front, which has been quiet for a very long time now.



Good Luck,


The Masked Stock Trader

Goodwill Explained: Quindell Context

I'm not an accountant, so to put it rather crudely, Goodwill is basically the difference between what you pay for an asset and its net asset value at the time of purchase.


e.g.

I buy a company for £100m, but the net asset value is only £80m. This means that the Goodwill figure in this example is £20m.


In theory, Goodwill is meant to represent the hard to value intangible assets such as: employees, brand name, market share, expertise, etc.


In the case of Quindell, who are having their accounts scrutinised at the moment and are also in the midsts of an FCA investigation, Goodwill is likely to play an important role in the up and coming release of their revised accounts, purely because it has been historically a pretty large percentage of their balance sheet.


If we look at Quindell's Report Year ending 31 December 2013, we find this statement:

"Goodwill recorded in the Statement of Financial Position at the end of December 2013 totalled £235.6 million of which £181.4 million was in relation to the Group’s Services Division and £54.2 million in relation to the Solutions Division."


Now, it's not surprising that Quindell has had some large Goodwill figures in its balance sheets, because they were a very heavily acquisitive firm in the early stages of the company. Nevertheless, I felt that I ought to issue a warning to other shareholders (like myself), because I suspect that there's a decent chance that we could see some impairment charges to this Goodwill figure (downward revisions).


In this case, it's therefore quite likely that we could see a "faux-drop" in the total company equity in the "financial statements" section of the results. If this happens, it's worth remembering a few things:


1. The Quindell we have now is the important focus for longer term holders.

2. The sale of the Professional Services Division (the historic big earner) means that the re-publishing of the results are in my opinion of little relevance going forwards.

3. Accountancy regulations dictate that Goodwill can only be recognised if you pay for the asset - a home-grown brand can't have a Goodwill figure, making the situation potentially very confusing when looking at the company's "true" value.

4. Goodwill is horrifically subjective (who's to say if you payed too much for a company or not?), meaning that you can make a pretty good argument for ignoring any revisions within five percent of the figure.


Have a nice day,

The Masked Stock trader

Gulf Keystone Petroleum - Technical Update

Evening,

I have blown these images up to a slightly silly size so that they vaguely useable for those with poor eyesight. If this causes trouble on your platform than I apologise in advance.

The longer term technical (not fundamental I should add) outlook for Gulf Keystone isn't exactly Rosy, but for those with low average prices a rise to the next resistance point of 32p seems very plausible in the near term.

The longer term classic technical pattern after a major spike downwards, if for a recovery ~75% of the way to the previous significant price high (42p in the near term, giving an initial target of around 31.25p for long traders).


This being said, I would direct readers to an old post of mine referencing the changing fundamental scenario regarding the oil production, payment system and medium term outlook of the company from a fundamental perspective:

http://themaskedstocktrader.blogspot.co.uk/2015/07/gulf-keystone-petroleum-new-payment.html

http://themaskedstocktrader.blogspot.co.uk/2015/07/gulf-keystone-petroleum-positive.html

The picture above demonstrates where technical stops should be placed for short side traders. This being said, I'm not convinced that trading providers (and their clearing banks, which are at the heart of all trading) are actually allowing people to open short positions here.

The image above illustrates the hook reversal pattern as of the penultimate trading day of last week:


I'm not wildly fond of this pattern, so people who want to read about it can find information here:

http://thepatternsite.com/HRD.html


Nevertheless, the rise of over 8% since the confirmation of the pattern suggests a very significant bullish reversal is on the cards for the next couple of weeks.



Enjoy,


The Masked Stock Trader

Student Debt - The Next Sub-Prime Crisis?

As far as I am currently aware, very active institutional trading of student debt isn't currently occurring, however I'm going to discuss some reasons why I think it almost certainly will happen over the next decade:



In order to understand this theory, we have to go back seven years to the 2008 financial crisis and the rise of Collateralised Debt Obligations (CDOs).


In effect, a CDO is a group of loans that are packaged together to make a tradable product that can be sold between banking institutions and hedge funds. CDOs have been used in financial markets since 1987, when junk bonds were grouped together by Drexel Burnham Lambert and were initially intended to make the trade of assets with predictable income streams easier (credit card debt, auto loans, etc).


CDOs remained a niche financial instrument until 2004, when the U.S. led housing boom caused a boom in the sale of CDOs, which in turn led to the creation of CDO derivatives (options and swaps) and eventually to the issuing of sub-prime CDOs in the run up to the 2008 crisis.


The use of CDOs to package student debt has been used for the past five years in the U.S., with companies like SLM Corporation leading the way with these products and this is presumably what Arrow Global are doing with the UK student they sold to them in 2013.


The use of CDOs in this fashion remains an excellent idea for the issuers, when we are in a low yield environment in combination with globally low interest rates. However, the nature of many student loans being index linked in some form, means that when either growth or interest rates begin to rise substantially (which regarding economic cycle dynamics means at some point they inevitably will), the default rate and or the rated value on these loans will also fall.


With U.S. student debt now totalling over one-trillion dollars in value, small increases in default rates begin to have much larger value in monetary terms than they otherwise would in smaller markets. This combined with the leverage that derivatives on these CDOs can carry in the over-the-counter markets means that the potential for volatility is likely to high in this debt market over the coming years.




Food for thought....

The Masked Stock Trader

Fundamental Trade Notes: Short Silver

Morning,

Here are my notes for reasons why I am currently short silver:

1. China Growth Concern:

- Caused a drop across the commodity markets over the past month, of which a drop in silver has lagged behind the fall in the other major trading commodities.

- The drop and continued uncertainty in the Shanghai Composite Index is likely to continue to weigh down upon the Chinese economic outlook over the coming months.

2. Dollar Strength:

- Moves in the FOREX markets in combination with the poor Eurozone outlook and Asian quantitative easing program have created a dollar strong environment, which will help to pull all commodities downwards in price.

3. Gold Correlation:

- While silver does have more industrial uses than gold, it generally correlates with the gold price movement (as a fiat currency hedge - buying gold is going long market fear), which has been steeply downwards over the last couple of days. Silver needs to make a significant move downwards in order for this correlation to remain consistent.

Enjoy,

The Masked Stock Trader

Gulf Keystone Petroleum - Positive Fundamental Changes

DISCLAIMER: This should not be seen as financial advice to buy or sell stock!



Morning,


I'm a technical fan of Gulf Keystone Petroleum (GKP), but I'm going to put that to one side for the moment and briefly discuss the positive changes that have occurred recently that have made me decide to add to my long position here:



1. Independent Oil Sales:

- To quote the 29/06/2015 RNS: "Currently, sales of Shaikan oil comprise crude oil export deliveries by truck to the Turkish coast and sales to a domestic buyer under a new six months contract which provides for off-take of between 12,000 and 40,000 bopd." 


- This suggests to me that we're finally in a place where the cash position can be allowed to either grow slightly and or remain in a neutral position.


- In addition to this, the chances of a placing being required to satisfy the bond holders of the company in accordance with the general overheads is now significantly reduced.


- If this 12,000-40,000 is sold at the rumoured market rate of $29/barrel (see LSE.co.uk), then this gives a daily revenue stream of between $348,000 and $1,160,000, which should certainly provide some stability to the company in the short term.


- Added to this, the rumour on the market (see LSE.co.uk) is that the current production rates are been split between this independent and the Kurdistan government at a 50/50 ratio, giving a daily revenue figure of £580,000.



2. Kurdistan Bond Raising:

- This is a possible fundamental change in the region that will allow for the possible repayment of debt to GKP by the Kurdistan government along with the future payment of oil produced - this begins to reassert the company's potential dominance in regards to both its production expansion and its asset size.



3. Kurdistan Vs ISIS:

- Kurdistan have proven themselves to be a very good weapon against ISIS in conjunction with US Army technical drone support, which places GKP in a much more geopolitically safer place toil companies in the region.


4. Recent Institutional Activity:

- According to Morning Star, the following funds have recently added positions in the company:

iShares MSCI EAFE Small-Cap
iShares Core MSCI EAFE
SPDR® S&P International Small Cap ETF
iShares Core MSCI Europe
iShares MSCI Europe Small-Cap
iShares MSCI United Kingdom Small-Cap
iShares MSCI Global Energy Producers


http://investors.morningstar.com/ownership/shareholders-major.html?t=GKP



5. Asset Sale Probability:

- All of these factors (especially the increased chances of an increase in payment consistency) add to the potential value of the company to potential bidders and a cashflow positive environment for the company would make GKP a significantly more viable bid for larger companies.


- We must also remember that they are sat on what can only be described as a "world class" asset, which under the current low share price makes GKP a screaming target for M&A in the Kurdistan region.


- On a balance of probabilities the chance of a significant increase in the share price seems more likely over the coming months and years than a major fall, but as ever, do your own research.



Enjoy,

The Masked Stock Trader

Greek Austerity Measures: No Voters - As Explained By A Ten Year Old

Free Technical Analysis Tools

Below are a list of online tools that I have found useful as a (for the best part) technical swing trader of equities:




Free Chart and Candlestick Pattern Scanners:


http://stockcharts.com/def/servlet/SC.scan


https://www.britishbulls.com/Default.aspx?lang=en


https://www.americanbulls.com/Default.aspx?lang=en




Free Candlestick Pattern Statistics:


http://thepatternsite.com/CandleEntry.html




Free Chart Pattern Statistics:


http://thepatternsite.com/chartpatterns.html




Free Live Trade Data:


http://www.moneyam.com/


https://www.google.com/finance




Free Learning Resources/Idea Generators (UK):


https://www.youtube.com/user/zakmir1


https://www.youtube.com/user/TheMarketSniper



Enjoy,

The Masked Stock Trader

Long Glencore and Thomas Cook

I went long on Glendora and Thomas Cook yesterday morning.


Thomas Cook (TCG):

• This is a volatility funnel trade (very similar to a symmetrical triangle formation really) on the daily chart beginning at the high on April 10th.

• I am looking to exit between 165p and 170p here and I'll begin to rethink/.reanalyse the position at the 150p level and exit at 145p.

Glencore (GLEN):

• This is simply a medium term upwards trend follow.

• I'm looking to exit between the 325p and 330p level. I will begin to reconsider/reanalyse this trade at 195 and probably exit at a break of the 190p level.

Enjoy,

The Masked Stock Trader

Free Weekly French Technical Analysis 13/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

This Week's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfmRTT0RSQkhyTUJhdnhUSWxZN0pqNXVqTnN5UzE1aF93UGRIWVQ1UkdZQlk&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free French Technical Analysis 10/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfjQweEhBYXlQSVFlWnBkZlBEU2c5WnlyMWwzOF9XTkZwMVEzOHZHbDNhbmM&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free French Technical Analysis 08/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfm8zcWgxUEpnRnMySkRUbkdZUDFZOWZTQUtHdUxNcUFYWXZNb2x5XzRLdTA&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free French Technical Analysis 07/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfjNLVnREdlRQYUlQa3VOTTNkZE90Wi01OHdEdEowX3pZYnlFbmhVMy1GamM&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free French Technical Analysis 02/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfmtWY1MwX2NNQWV4MGd5WFRyU3BHdVpONklaU2VIZk84ZzhpYWF1Q0dwNDQ&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free French Technical Analysis 01/04/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfk1uT1JtNi0xZTFHdzhUOFRoUndZUmZqUWVLQnJuS2lVTkZTMDFUbjctTjg&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free UK Technical Analysis 27/03/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmfnpWX2czbzZFV1FrekJwQVhhOXZSYzM1MWhoQkl5R25KSm9HOHhPTDYxc2c&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html

Free UK Technical Analysis 24/03/2015

DISCLAIMER: I am not FCA authorised or authorised in any sense to give financial advice. Do not regard any of the following links, or information as investment or trading advice.

N.B. Currently FireFox does not support Google Drive and therefore these reports may not open.

Today's Analyses:

https://drive.google.com/open?id=0B0wd9XTIWftmflk3TUNBVkJXTFZFRHZBQW9PM3ZHZmlSc1hqWTZqU190TnY3WUZWakFjNzA&authuser=0

How to use these reports:

http://themaskedstocktrader.blogspot.co.uk/2015/03/technical-analysis-instructions.html

More information regarding this project can be found here:

http://themaskedstocktrader.blogspot.co.uk/2014/11/my-experience-with-quantitative-finance.html