Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
If you want me to analyse a stock for you just drop me a line at [email protected] - Today I look at Cyan, Gulf Keystone and Infrastrata.
Cyan (CYAN): Retest Of 2014 Highs In Prospect
Cyan was definitely one of the brightest prospects in terms of the minnows for 2014, a point witness by the near vertical ascent for the shares that can be seen on the daily chart over the June and July period. However it would appear that the stock did get ahead of itself in terms of a rise from 0.1p to 0.6p plus, and we have been in consolidation mode ever since. Nevertheless, the good news here is that this consolidation has been almost entirely above what was pre June resistance of 0.2p, and this may be sending a positive signal of note to bulls of this company. As far as what we are seeing near term is concerned, it can be seen that after April's bear trap retest of the 0.2p level, we have witnessed a much higher low above this number for May, something which may suggest that after nearly a year of consolidation this situation may be ready to retest the best levels of last year. That said, it may be worth waiting on at least a weekly close above the 20 day moving average/0.3p before deciding to follow this situation higher. Above 0.3p the initial target is post September resistance at 0.4p, a destination which could be achieved in as little as 2 to 4 weeks after the 200 day line is broken.
Gulf Keystone (GKP): Still Haunted By The Technicals
It was certainly the case a couple of years back when I suggested that the worst-case technical target for Gulf keystone shares was for them to hit 10p meant that I was not the most popular chartist in town. However, it may be observed that given what has happened to the company since early 2013, especially with regard to geopolitical issues and the price of oil, the stock may have actually been relatively resilient in comparison to the rather shocking 10p target. The position now is that we seem to be viewing a situation which has been relatively consistent within a falling trend channel from July last year, a channel which is capped by the 50 day moving average at 38p. All of this goes to suggest that provided there is no weekly close back above the 50 day line we will Gulf Keystone head yet lower within last year's channel, with its support line projection currently pointing to a sub- 20p target. Given the way that all the downside targets in the recent past have actually come to pass despite being on the scary side, it seems difficult to believe on this occasion the stock will be able to resist the selling pressure which clearly still exists for this much followed company.
Infrastrata (INFA): Above 50 Day Moving Average Points As High As 6p
A key aspect of the price action over much of the past year at Infrastrata is the way that the blue 50 day moving average currently at 3.66p, capped the price action on any rally attempts since the summer. Indeed, there were several occasions when one could have shorted this situation as a standing order when the price action hit the line. However, it can be seen that since the middle of last month there has been a change in the charting setup with the recovery of the 50 day moving average on a weekly closing basis being the main clue as to the prospect of a lasting turnaround. If you add in the way that over much of the past month we have also seen a surge in volume, and new support points at or above the 50 day moving average, then it would appear that the consolidation being delivered by Infrastrata around the 4p level is very much a positive one. It also helps that over the past month the RSI now at 59 has remained wholly above the neutral 50 level, and that there has been a golden cross buy signal between the 20 day and 50 day moving averages. The view now from a strategic point perspective is that one would be looking to buy the stock on any dips towards the 50 day moving average, with only an end of day close back below this feature delaying the prospect of a top of January 2015 price channel target at 6p plus over the next 1 to 2 months.
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