Editorial Contributor
Centamin As with Randgold, African instability has taken a heavy toll on Centamin’s share price. The revolution in Egypt last year – where Centamin’s Sukari mine is located – has led to fears that the new government might nationalise its operations or redraw the terms on which it does business. Egypt is reliant on foreign investment, so the authorities may tread carefully. But radical and inexperienced administrations can, and often do, spring nasty surprises.
Centamin Chart Day-to-day operations at Centamin have also caused some concern lately, albeit on a much lesser scale. Dearer fuel-costs in Egypt have bitten into profitability, along with a shift in production towards low-grade areas while access to the higher-grade areas is developed. Still, the company is on course to meet its target of producing 250,000 ounces this year.
88 www.financial-spread-betting.com | July 2012
Since making a low of 59p in early May, Centamin’s price has rallied to as high at 77p. However, it has done so in choppy fashion. Choppiness is typically the hallmark of a counter-trend move. It also makes trading difficult. For now, I would see a drop to 59p and 53p as the likeliest outcome. Drops through the 21-day EMA would be my ideal shorting opportunities.