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Since last Thursday, price and volume have fallen further, suggesting to me some serious distribution.

Incidentally, those small 12c trades are not buyers stepping up, but sellers getting rid of stock. And usually, where small quantities are traded every few minutes, it's a Big Player involved.

 

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The chart itself hasn't changed much since the last I posted.

 

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Arty,

Dunno if its just terminology, but I really dont agree with the words you are using . This is not meant to challenge your analysis either.

Let me explain my view on volume and serious distribution.

 

For a minute, accept that all volume is selling. if a buyer steps up..there is a seller at a higher price

If a seller sells down, again a seller. Now, if there are no buyers within miles of the last sale, the price can not fall unless there is a seller willing to cross the divide and make the next transaction happen. Say there are buyers willing above the last sale, yet sellers have withdrawn to even higher levels, no transaction can take place unless a seller exists at that time.

Now in relation to distribution, having temporarily accepted my theory above. All volume is selling, if volume is low there is little distribution because distribution can only occur when owners of shares are meeting the market .

When you look at GUF, the upthrust on 6th Aug was demand eating into the sellers who existed above the recent previous higher levels. Normally, once the demand has been met, new supply arrives as owners who were waiting for even higher prices, realize the buyers are no longer willing to keep eating through the higher levels of sellers, they become impatient and start to sell lower.

The level of selling (so far) has been light and declining in number. To me this is not serious distribution. As the last sale price has become lower, fewer sellers have been willing to sell to the point where some impatient buyers were forced to again buy higher if they wanted to own it. See today, more volume started to enter the market and price rose slightly.

I say "low volume is always indecision by the market" and GUF's volume has wound down to that point, and price usually goes in the direction that increasing volume sends the price.

From all this, I'd say the initial sign is price is now more likely to rise from here, with the caveat that general market sentiment (bullish) needs to continue otherwise large volume will arrive and it will then be distribution.

 

Long and drawn out, sorry but volume analysis is almost counter intuitive to normal market methods and not easily explained with a chart.

No offence intended to your analysis.

 

Cheers, M

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SO mistager says it will go up and Arty says it will go down :weirdsmiley: l guess that just leaves me confused, :wacko: l guess l will just have a stop loss to be safe and hope they release some positive news to boost the share price.But Arty does have a point about all those millions of little 500 sellers, looks like some big guy is manipulating something
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l will just have a stop loss to be safe

That's always a wise decision, Captain.

Neither Mista nor I can "know" with certainty what will happen or who is behind those possibly manipulative trades.

I have simply pointed out that I see more downside risk, so I prepare for that by not (yet) buying. May miss the first couple of cents profit IF Mista is right; but won't lose a cent if the coming news isn't as good.

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So here's your answer: Hat tip to Mista.

He got it right and I missed yesterday's early buying pressure. It appears that the small-fry selling down into 12c was the red herring intended to hide the buyers' interest.

 

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I presume you've held as your stop wasn't activated.

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:unsure: Even if I had taken a punt yesterday and bought 12 or 12.5, I'd be most likely out today.

I don't like the shape of today's candle, and the overhead 55-day EMA appears to have stopped the rise for now as well.

(I'm not very keen on coal mines either, even though a change in Canberra could give them a boost.)

 

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IMHO there are better prospects around.

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