is charting.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
OT: There is actually quite a long list of proclaimed margarita "inventors." :) Which one of these is your friend's grandfather?
Danny Negrete; Garci Crispo hotel in 1936.
Francisco "Pancho" Morales; Juárez, Mexico in 1942.
Carlos "Danny" Herrera; Rancho La Gloria bar in 1938.
Margaret Sames; Acapulco, Mexico in 1948.
Santos Cruz; Galveston, Texas in 1948.
Enrique Bastate Gutierrez; Tijuana, Mexico in early 1940s.
It's pretty simple, really. Either you believe they have well over $10B of niobium and tantalum in the ground (plus whatever other REE's and uranium) or you don't. If you believe the resources are there, a $0.03 stock price (~$20M market cap) is a gift from the Heavens. Once they drill this summer and analyze those results, the stock will reflect the confirmation of those resources and be *much* higher. I'm perfectly willing to wait 6 months for a 500% to 1,000% return from this level.
There are only about 325M shares of restricted stock at the moment, so the 450M that Scott said are "tightly held" includes both restricted and float. I asked for that clarification after the comment and he said yes, that 450M includes both restricted and float.
That was my conversation. I asked Scott about who held the 325M shares of restricted stock, and during the course of his answer he said he knows of at least 450M shares that are in "tight" hands (i.e. holding on for much higher levels).
cmzio: I did not ask him about any other properties. At this point, they are pretty much focused exclusively on Nemegosenda, which is as it should be. That resource is a company maker and they know it. Once the stock is at much higher levels, then they can start spending money on their other properties.
seabreezing: Yes, nice tag team action today. :) Well done!
"Spot" price of niobium and tantalum?
Anyone have a good source for current market prices of these guys? I was on the phone the other day and it was mentioned that niobium is currently up around $32 to $33 per pound. Can anyone confirm? TIA
I spoke to Scott today as well. The big news is that their goal is to drill both zone D *and* the east zone this season. The first step is to get the access road in good shape, and then the drillers will come in and get to work. Financing is not a problem. They have people lined up to invest in private placements. The key is to structure the deal(s) so that we (the shareholders) don't suffer. He doesn't want to dilute at these low levels.
If the results of the drilling program this summer are as we expect, we could be looking at $15B or more of resources. If you divide $15B by the current market cap of about 25M, you get a ratio of 600. That is what I would consider major undervaluation. Of course, the stock won't attract the big money until it gets off of the pinks, so that's an important step as well. We need to get onto a real exchange to become fairly valued.
As for the stock, he said he knows of at least 450M shares (both restricted and float) that are in "tight" (i.e. waiting for much higher levels) hands. That's over 60% of the outstanding shares.
Exactly right, moojer! There are also NO permits. There is NO financing in place to construct the mine. There are NO friendly or hostile offers to takeover the company. There are NO dividend or stock split announcements. There is NO FDA approval for their latest drug. There is NO contract with Cisco to manufacture and distribute their latest networking products. There is NO agreement with the Chinese government to sell their food in super markets across China.
See, I can also list lots of facts that are completely irrelevant to the current state of SRSR as a junior exploration company. :)
PS: I love the fact that you put "bankable" in quotes. That gave me a good laugh. :)
It's not a double bottom, more like the beginning of a consolidation (and hopefully continuation) pattern:
Double bottoms (and tops) are terminal patterns that mark a change in primary trend direction. They are not the most reliable pattern, but they do work a good amount of the time. There's a very old saying: "Double bottoms often hold, but triples rarely do."
What we have here in the case of SRSR is the end (again, hopefully) of a three-phase corrective wave that began on the day of the spike at the end of April. The most bullish scenario would see subsequent price action create a cup-and-handle formation before settling near the recent highs in a tight range. What I'll want to see during the coming weeks is a bit of chop (i.e. one week up, one week down, etc.) with a slight upward bias--that would create the "cup" in the cup-and-handle. That would be the ideal scenario in my mind moving forward, as we still need to spend some time consolidating those gains from April. We'll see what happens...
Nice paint job!
The last trade of the day came in at 3:59:59 PM for 5K shares at the high of the day, $0.048. We have our bullish engulf courtesy of that trade. :)
cmzio: Very nicely done! Where (i.e. which address) did you send your e-mail? I'll send one as well. :)
I suppose it all depends upon how "sure" they are about the potential of the east zone deposit. But, yes, proving up zone D and analyzing those cores for the new substances has its own merits. I'm sure they'll take their time reviewing the options and make the best decision.
I think they're deciding how best to proceed right now.
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29501187
Do they start with zone D or the east zone? Which will provide the most bang for the buck? I'm thinking it might be better to start with the relatively unexplored deposit in the east zone, because if they discover that it is in fact as "big" as zone D, that would effectively double what they have, and they could look for tantalum, REE, uranium as well. If they find it there, it won't be much of a leap to conclude it's in zone D as well. :)
Yep, a close at or above $0.047 would be very bullish. Let's see how the rest of the session goes...
The MM's continued to walk it down on low volume at the open, looking to scare up some shares. We're half an hour into the session now, so let's see if we bounce (and how hard)...
silicon: I don't think it is selling Scott short simply to note that someone with incredibly deep pockets is watching from the wings, willing and able to provide financial assistance should it ever be needed. As you say, Scott may be perfectly able to faciliate all of the financing himself.
BTW, in my latest e-mail from IR I learned that they (father and son) spent a week together this past Christmas. Take it for what you will. Seabreezing, the next time you talk to Scott directly, would you mind asking if his father is a shareholder? TIA!
The real story of this chart since the beginning of April is the volume and money flow:
Big volume on the uptrends (circled in green above) and overall below average volume on the consolidations and corrections (except for the volume spike on Hawk report release day, but that session ended up being a bullish doji). That overall volume profile doesn't get much more bullish.
The chart needs to repair itself, so now we wait and see how the next formation develops. Would have been nice to hold $0.04, but this is the pinks after all and the MM's need to cover. :) Good support band right in here from $0.035 to $0.04 and the Bollinger bands are tightening up nicely, so there's a decent chance we find support in this area following that 50% retracement. We'll see...
In all seriousness, we should keep in mind that money will never be a problem here. "Hey, Dad, can I borrow half a million to do some drilling?" "Sure, Scott, let me get my wallet..." Not quite that simple, of course, but it really is. :)
How many of you have called in and asked questions about expenses? That was one of my first questions. How are you funding the day-to-day operation of the company? Was one of the answers ever along the lines of "loans" from "people close to the company"? No names, of course, but it doesn't take much imagination to fill in some potential blanks. BTW, has anyone asked them if Scott's father is invested in the company? If not, I'll ask the next time I call.
I wonder if Sprott Asset Management would be interested in SRSR? Like so many others, they are probably prohibited from investing in pink sheet companies, but they are famous for taking large positions in tiny commodity stocks. Maybe we could send them a deluge of e-mails. ;)
PS: mrgoodtrade, PM me your e-mail address.
Yep, MM's love unregulated exchanges. It's their own little personal playground. They open up a ton of naked shorts during spikes and then walk it down to cover at a nice profit. They know the mentality of the typical pink sheet investor and they try to take advantage of it as much as possible. It's been several years since I went long a stock on the pink sheets, and now I'm remembering why...
Fundamentally, this stock is grossly undervalued. All we need is the patience to wait for that situation to correct itself. :)
According to a recent conversation I had with IR, about 75M or so of those restricted shares are now in the float. Apparently one of the directors from before Keevil cashed out this year. Can anyone else confirm?
Yep, yet another example of inefficient markets in action. Sounds like an opportunity to me.
I'm a Dow Theorist, which in a nutshell means that I believe the price action is king. It knows more than I could ever hope to. In my view, FA analyzes only fundamentals, while TA analyzes both fundamentals and investor psychology. Yes, in the opinion of us Dow Theorists, TA is actually a superset of FA. Many will disagree, but there you have it. :)
And I'd say SRSR is a prototypical example of a successful TA signal. When the stock broke out of the long consolidation formation at the beginning of April, it was telling us that good news was on the way in the form of the Hawk report. The stock went up about 700% (if you count $0.07 as the true peak, which I do) which is a substantial rise. Now we have to consolidate as the MM's have their fun. Such is life on the pinks. In the long run, fundamentals trump everything, but short-term anything can happen, especially on an unregulated exchange where MM's can naked short with impunity. I'm in this for the long-term payout, so MM games don't affect me much. We'll get there in due course...
Yes, indeed:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=29506065
Support near both $0.04 and $0.035. Any purchases in this "band" have a very good risk/reward ratio looking out 3 to 6 months. I am a buyer. :)
We don't disagree. TA always has value, it's a matter of knowing what type in each context. TA is one of many helpful tools available to traders and investors. I never open or close a position without its blessing.
Reminds me of an old saying they have in Washington (DC): "A billion here, a billion there... pretty soon you're talking about real money." :)
It's typical pink sheet action. Flippers are moving on. The MM's got short on the way up, and now they're covering on the way down. The stock won't be properly valued until it gets onto a decent exchange and the folks who are prohibited from buying pinks start accumulating.
goforthebet: That post wasn't directed at you personally. I just happened to be replying to your post when the gears started turning. It was general commentary. :)
Claytrader and I have non-trivial differences in our TA processes. I've been analyzing charts every day for over 10 years now and I even consult for a local hedge fund, so I've had some success with charting. I use TA very successfully to swing trade ETF's (e.g. GDX and SPY), but I would never attempt to do so on a penny stock. As I've posted before, TA works the best when applied to a highly liquid vehicle trading on a well-regulated exchange. Granted, you can trade on the pinks with TA, but only if you are dealing with small positions--again--because of the lack of liquidity and regulation. Not all of us have that luxury. ;)
Say, for example, you have 5M shares of SRSR. In order to sufficiently manage risk (and the associated short-term capital gains that you will have to pay every time you sell), you must be able to move at least 1/3 of your position every time you flip. Otherwise, statistically speaking, the potential reward simply isn't worth the associated risk. This is a well-known trading rule that has been well researched by much smarter traders than I. Thus, in order to play a spike in SRSR with your 5M share position, you must be able to sell at least 1.7M shares very near a highly probable short-term peak. That would be very difficult to do on a stock like SRSR.
Take the 4/30 spike that was caused by a large buy order that was entered pre-market. I watched L2 very closely that morning, and the MM's didn't give anyone else a chance to cash in on that move in a material way except themselves (and they sold short into the open to fill that order). The best you could have done (if you know what you are doing) is an average sell price of about $0.062 (and I'm being generous for the sake of argument) on those 1.7M shares of additional sell-side volume. What is your capital gains hit on that sale? Let's say you got in before the run with a cost average of about $0.01. Your net gain on that flip would be around $88K and your tax liability would be around $25K (depending on your tax bracket). That's $25K that won't be compounding for you anymore.
Ok, so you're already "in the hole" $25K on the trade. What re-entry point will make it worthwhile? If you are using TA correctly, you would have to wait until at least 5/6 to start buying. Go back and review the intraday price action during that session. There was very low volume as the stock began to stablize in the low $0.04's, and when buying pressure came back in, it spiked up to $0.05 on about 3M shares late in the day. So let's assume you get back in over 5/6 and 5/7. Buying back with your net gains from the flip would get you about 1.85M shares at a cost average of $0.048 over those two sessions (again, I'm being generous and assuming you know how to accumulate the right way). So, for all your trouble you were only able to net about 150K additional shares (value at time of purchase: $7K). But, wait! Don't forget you now owe the IRS $25K. Where will that money come from when it's time to pay up? Have you made $7K or lost $18K?
Anyway, sorry to ramble on, but the point is this whole idea of being able to jump in and out via TA and make piles of cash isn't as easy or simple as many posters would have you believe. You need to look at many different factors and crunch the numbers. If you are holding a large position in SRSR (or any pink, for the matter), flipping simply doesn't make much sense. All JMO, of course!
Digesting gains
We're in the process of consolidating those massive gains from the beginning of April:
There's nice support right here at the $0.04 level, and it looks like a big buyer is taking advantage of it to accumulate today. If you are in this for the long-term, today looks like a good entry point to me. I've been nibbling at the ask.
Welcome back, seabreezing! Good commentary. From my recent contact with them, it sounds like they are carefully planning their next move. They truly feel that the stock is grossly undervalued at these levels, and they want their next move on the property to supply as much new intrinsic value as possible. As they see it, they basically have two options:
1) Do some relatively quick drilling in zone D and analyze the cores for things such as tantalum, uranium and REE's.
2) Drill in the east zone and get a good idea of the extent of that deposit.
There's even a chance they could do both this season, but which should they do first? Which would provide the most shareholder bang for the buck? If they choose option 1 and it turns out there is a substantial concentration of the things they suspect, that could certainly be a game changer. But if it turns out the east zone hosts at least as much as zone D, so could that. Should be an interesting season... :)
Of course they wouldn't say that publicly, nor should they. They need to do a lot of work on the property to prove up the resources. However, talk to enough people and you might be able to uncover some interesting information for yourself... ;)
I get the sense it will probably be private placements with people "close to the situation" (i.e. people they know). As you can imagine, Scott knows a lot of people with money. :) Wouldn't it be something if Scott's Dad participated?
At this point, it's just a guesstimate based upon all of the historical data. They'll need to do lots of drilling and analysis to prove it up.
texas: All options are on the table at this point, even the possibility of spinning off the Nemegosenda property into a brand new company on a Canadian exchange (where it would be more... accurately valued).
"'Numerous post-ore faults have been observed in the western margin of Zone D. Most notably, a northeast trending fault cuts off Zone D along its west edge. Right hand movement is suspected and drilling has yet to locate the Zone D extension.'
Looks to me like Zone D is open on the western edge allowing for a drilling program to increase the resource in Zone D."
Yep, that caught my eye as well as I was reading the report. :)
Sentinel: When I wrote "this season" I meant this drilling season, so by October or November (depending on the weather).
Based upon their analysis of the historic data, their engineer believes there is at least $15B in niobium and tantalum alone (note, belief is not yet fact!). As they perform the drilling and analysis required to prove that up, the stock will appreciate. Slow and steady price appreciation is always the most healthy way for a stock to move higher. All we need is patience...
Spoke with IR this morning
They're planning their next move with regard to the niobium property, and they will definitely be drilling this season, hopefully twice. They will probably pay for the phase I drilling and analysis themselves ($300k to $400k), because they don't want to get taken advantage of via a partnership at this point. They have lots of interest in partnerships already from big entities, but they feel that the stock price is significantly undervalued at these levels, so they don't want to enter into any agreements that would negatively impact shareholder value. They feel that once they prove up what they have (e.g. confirm the reserves in zone D, confirm the existence of tantalum, uranium and other REE's, confirm that the east zone hosts at least as much niobium as zone D) and get off of the pinks, the stock price will better reflect their assets. To sum up, they are reviewing all of their options for the phase I drilling program and will pick the one that maximizes shareholder value, being shareholders themselves.
Also, I confirmed that Scott's 30M restricted shares can not be sold for 2 years, and they (management) have been buying shares in the open market as well. :)