Monthly low in Feb 2009 (red horizontal line) target entry. Which is also the gap fill 'region' created in August 2019.
candle formed on daily today. Suggesting todays drop was overdone. Also starting to look oversold on the daily.
2:1 Risk/Reward trade.
STOP: 2.8 ( ish ).
Downside: 15% risk to below the daily 200ma which is around 2.89.
Weekly 200ma is around 2.96 and 78.6% FIB is around 2.80.
Both daily and weekly moving averages, as well as the FIB level should act as half decent support.
Upside: AT LEAST 30%. Back to 50% level and previous (recent) highs.
Fundamentals: Further funding news is expected in the not too distant future. This week’s drop looks overdone. Drop in nickel price and global markets getting hammered are most likely to blame (rather than a company issue).
I have taken a ’trade’ today at 3.26. Shorter term.
However, HZM is also one I hold as a long term investment in an ISA (and have done since 2015). With a 2p average. Thus, my ‘trade’ view may be biased because of my long term holding ;-)
However, patience is a wonderful thing. I have now closed the shorter term trade position I had for a 15% profit. Short of the initial target, but profit is profit. I still continue to hold my long term ISA position.
It is also worth noting that I use open/close prices of candles for entry and exit points. Rather than highs and lows. I am not overly concerned if price 'pokes' through a level intraday. For example, if price pokes down through the 2.98 FIB level, it is just testing it. It is only once it has closed below it that it becomes of more importance (to me).
As the trade is focussed on a 30% upside movement here. Then a 2:1 risk/reward play means the risk can be as much as 15% to the downside. Which sits nicely out of the way of the 2.98 FIB level and 200ma. Both of which could well be 'tested' before the move upwards commences. Especially as HZM has a habit of tracking Nickel price. Usually with a bit of a lag though.
By the way. For what is is worth. An awful lot of my share purchases carry Friday afternoon dates on the contract notes. Day traders don't usually like to hold over a weekend, but will be happy holding overnight in the week. It is not uncommon therefore to see a Friday afternoon drop sometimes because of this (not always of course). Which gives a greater entry point, and, something I have often taken advantage of over the years to lower my entry points on shorter term holds. Monday can have the reverse effect, shares can pull up as the traders move back in for the week.