08 Dec 2014 09:20
Price at rating: 2.75, now:
PLENTY NEWS COMING, Independent Resources (IRG) Higher December Floor Points To 5p October Resistance
IRG Independent Resources PLC Technical Analysis 081214
Although it is clear from the wide swings in the price action of Independent Resources over recent months, and in the aftermath of the late May unfilled gap to the downside, this is a highly speculative and volatile play – charting rules do still apply. For instance, both November and December have delivered higher lows versus the September support well below 2p, and this enables us to draw an uptrend line on the daily chart over the past three months. Indeed, this line is backed by an extended October support line in the RSI window which has been multi tested at the 50 level. The RSI is now up to 55, high enough over neutral 50 to suggest that a sustainable break to the upside could now be on tap. This is especially the case while there is no end of day close back below the 50 day moving average at 2.49p, suggesting that although Independent Resources does traditionally offer traders a rocky ride, in this instance we are looking at a reasonably decent risk / reward prospect. The reason for the relative optimism in this instance is the way that October’s peak was well above the 5p zone, and the run up to that spike happened to be very similar to what we are experiencing now.
The message is therefore to assume an imminent break to the upside, with only cautious traders waiting on an end of day close back above the late November 3p level before taking the plunge on the upside.