It's great that SP hasn't dropped below 2c, however I am not getting to excited about the recent increases as it has all been done on very low volumes.
There is just no liquidity in the market at the moment, so trying to sell a decent parcel of shares at these levels is difficult, so the market becomes easy to manipulate.
The concerns at the moment include:
- The price of gold and other precious metals are on a downhill slide - The U.S Economy is in a terrible state, and whilst a sharemarket crash should drive the price of gold up, in the initial stages of panic, Gold and Gold Stocks will get hit by panic selling and also people selling Gold and Gold stocks to cover margin loans and other losses. - The company have a history of continuously raising capital, so the chances are they will be asking for shareholders to put their hands in their pockets again at some stage, creating further dilution. - The SP has a history of trading below capital raising levels
The companies long term future prospects do look bright, however I see shareholders being subject to some further short term pain in the interim.
TAM Price at posting:
2.3¢ Sentiment: None Disclosure: Not Held
