Dominic Picarda’s Technical Take
Stratex International AIM-listed tiddler Stratex is at a much earlier stage of its business-life than Randgold and Centamin. The company is prospecting for gold in Turkey and East and West Africa. It is hoping to begin mining at its Turkish site outside the city of Konya in the first half of 2013.
Stratex Chart
Small stocks such as this are not ideal for the purposes of technical analysis. Because they are illiquid, the trends and formations on the charts can be much less reliable. However, the liquidity of Stratex’s price has improved over the last couple of years.
The next targets for Stratex lie down at 4.8p, 4.4p and 4.2p. My preferred strategy would be to open short positions on further unsuccessful rallies to and slightly above the 21-day EMA.
Since hitting 11.5p back in February, it has entered a very strong downtrend, shedding more than half its value. As such, it has now reached oversold levels on its weekly chart, with a relative strength reading of just 30%. However, there is no immediate clue that its descent may be coming to an end.
July 2012 | www.financial-spread-betting.com | 89