Sharing a few thoughts below -
1/ Fall since $3 in June
I commented after exactly 1 year in June when SYR was exactly $3, and am again now commenting after more than 2 months. Here was an extract of my June comment (quoted) which talks of what I thought would be the road ahead after June 2018–
“C/ Road ahead
2/ From chart point of view, as I’ve explained in the past and again above, $3 level was a pretty critical one. SYR fell sharply from Jan highs to around 3.15 (another of my critical levels) and bulls have since been valiantly been defending the $3 level.
3/ Bulls have been defending the 3 level while bears have been attacking the 3 levels for the same reason IMO. If SYR holds 3 level, this could form a formidable level of support. If it doesn’t , it obviously leaves a door open to test the other critical levels that I talked about in late 2016 and early 2017 (most of which materialized)
4/ As FiendishRedbeard rightly mentioned a risk is that shorters might aim to buy back their shorts in ugly volume conditions well under $3…….
If at all that happens, SYR holders still brave enough to hold or new SYR holders would probably have to hope that SYR again bottoms at one of the key levels mentioned earlier and that marks a final capitulation. Importantly though, SYR holders should be hoping a corresponding sharp decrease in shorts once and for all.” – extracts from my June (quoted) comment
Aug 19 update – You will find that a lot has materialized what I said. SYR has
gone down more than 60 cents (20%) just since June.
We reached 2.8 almost immediately on higher volume and if you observe closely, we have been going from 1 key level to the next, little by little. SYR has had just a handful of closes above $3 and
highest intra day seems to be 3.15, another key level that I already talked about then itself in my June comment (earlier sharp fall from Jan highs). In short, my June analysis of “road ahead” was spot on.
2/ Key levels
2; 2.24;
2.39/2.44/2.5; 2.64; around 2.8;
3; 3.2 (
3.15 and 3.25); 3.45 to 3.53; 3.65; 4; 4.5; 4.72
One of the most important components of my analysis ever since I’ve commented on SYR. An understanding of the key levels that I mostly identified in 2016 itself would have been of tremendous help to a SYR investor all through, as the levels have consistently been respected. Even last close is 2.39 with intra day high of 2.44
3/ Commodities downtrend and general macro
I don’t follow SYR FA but one reason for SYR fall can also be that several commodities and especially battery commodity stocks like lithium, cobalt, graphite stocks have been hit very badly over last several months. This can work both ways and
SYR can recover if commodities recover or go down more with the general sector trend
Also, other macro tensions in recent past like China trade war with US and Turkey tensions. I’ve mentioned in past that SYR is particularly susceptible to
macro tensions.
4/ Shorters
I got the impression that shorting volume was increasing around key levels to push price below, but maybe I’m just imagining it. In any case, shorting level is still very high and as I’ve always insisted this is one of SYR’s biggest risks. IMO, SYR would experience some difficulty coming to a meaningful bottom with such a high level of shorts. One of
SYR’s best bet IMO has always been that shorters get their bottom, make a profit and get fed up and move on. A point I’ve always made is that IMO shorters were never squeezed despite what some die hard bulls might believe.
5/ Bearish price channel
If you look at chart, I think there seems to be a
bearish descending price channel from March with lower highs and lower lows. I’ve not drawn lines to see but lower highs and lower lows might just touch other, with parallel lines. IMO, investors concerned with SYR (whether bulls of bears) would do well to give this a better look.
Sooner or later, we could end up with a breakout or breakdown and either way should ideally IMO be on higher volume to give further confirmation.
Maybe if 2.39 hits the trendline, then we could have bounce here itself. As I mentioned, I’ve not drawn lines to check and see. If so, then we could have a healthy rise again before upper trendline is reached. I’ve never held SYR till date (to best of my memory) but have considered recently dipping my toes for such a trade, although obvious risks of breakdown exists
6/ 2.24 level and below
SYR bottomed around 2.24 in March 2017 and is now approaching that level again. If I remember right, after bottoming, we had a backtest of that same level. Ideally, considering we are so close SYR would
normally be attracted to that level again, especially considering that we had had close of 2.36 on Thursday and Friday close of 2.39 with intra day high of 2.44 IMO seemed resistance.
Strictly speaking, SYR can bottom around any of these levels.
But really, there are several alternatives here – Bounce (lower high) once trendline is hit and a healthy rise again, breakout from bearish price channel, breakdown from price channel, break of 2.23 support, etc.
I don’t know where it is going and am simply pointing out that we are at / approaching critical levels (obvious in case SYR investors have forgotten) for both bulls and bears and IMO both might need to be on alert. Although 2.24 was low in March 2017, my first expectation is that $2 could be next support if it breaks below. I’ve not analysed anymore and am just commenting based on that I remember from last year.
If we have a sharp fall smashing supports, bulls would ideally want a sharp rise like we had last year, taking SYR back over 2.24 key support
7/ Final words
A reminder again that I don’t wish you guys bad contrary to what some of you believe/d
I think the accuracy of my SYR analysis over time should speak for itself. Commenting in June, after a year, despite not following SYR FA, my analysis has still been spot on once again with a further 20 hit over 2 months.
While I don’t know where we are going from here, I’m just commenting to highlight that
very key levels are close, and some decision on the direction of SYR would have to be taken in time to come. I’ve highlighted
several alternatives.
Upward bounce off trendline in bearish price channel can delay such a decision being taken.
Bearish call at $3 in mid June was a much easier call but it gets slightly more difficult to analyse now.
Good luck with your stock.
to say exactly what is going to happen. If any part of above does not appeal to you, then please feel free to ignore
(20min delay)
