I always end up with egg on my face when I make short term predictions. But I like eggs - especially scrambled - so I'll give it another go.
I predict no retrace tomorrow. There'll be a lot of attention being given to the end-of-day trading reports overnight as traders get ready to take positions tomorrow.
This is a micro-cap so it would be incredibly easy to temporarily smash the price down without spending a heap of money. But in order to do so you need to have the shares to dump onto the market. As far as we know only Hartleys have a large bag of them. But they have been accumulating at low prices already. They don't need to smack this down for accumulation. That leaves shorting as an option, but so soon after an announcement this strong it's unlikely that they can turn sentiment around only with short selling. So shorting would carry an elevated risk.
Secondly, again as this is a micro-cap, there just aren't enough shares to make this a major play. Imagine you could hold the price down to 20c and accumulate. You could buy the entire company for $18 million. If they held for three months and the thing went to $1 that's still only $88 million. The institutional players spend that much on lunch!
I suspect that traders will sit this out, perhaps buying strategically to sustain the ebullient optimism of the retail buyers. When volume thins some time in the next day or three, perhaps on Monday, the traders will strike and make it look like something terrible is happening. Lots of heavy selling (using the strategic holdings accumulated on the way up). Retail holders will waver and start taking profit, then stopping losses, then panicking over some imagined pending bad news and selling at any loss - or some will.
Prices will drop sharply, then stabilise somewhere (in my guesstimation) around the 40c mark. From there I suspect we will see a downward drift in the absence of positive news while we wait for the study to be completed and the final results released.
If there's a steady flow of positive news indicating progress toward realising the commercial potential of the product then I would expect the price to continue climbing in line with the announcements.
Okay... eggs ready?
NTI Price at posting:
35.0¢ Sentiment: Hold Disclosure: Held
