Momentum Monday 30 October

29th Oct '23 by Elio D'Amato

5 comments 434 reads

Welcome to Momentum Monday.

Odds of a rate rise in Australia on Melbourne Cup day have increased. The odds aren’t improving that much for our US Friends either. The world is on edge of a major regional conflict in the middle east... Welcome to the market behaving normally.

This week’s content is as follows:

Broader market sentiment
Member corner
Stocks in the “Shine Zone” (including changes)
Buses pulling out of the station (volume + price movers)
52 week high screen (including changes)

Remember our Weekend Watchlist edition. This week I talked about Atturra (ATA) . Access the recording here. And if you bookmark the page you can just go there on a Saturday and see who is being discussed.

A special call out for our “Empower Others”” program. Please don’t forget it. The offer goes both ways to you and your friend so be sure to visit this page to learn more. And remember… you need to tell us you referred someone. Otherwise we’ll miss it.

Also you may have noticed, but a reminder, that the recent blogs area has changed its appearance on the home screen. We can now fit more articles on the front screen to make it easier to access . A full list of our commentary can still be found under Discuss >> Market Insights.

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A reminder that you don’t have to read all this contribution. Simply scroll to the area of interest.

Broader Market Sentiment

We look at the direction of both the US and ASX markets to gain an understanding of the broader sentiment at the minute. It is important to stress here that I DO NOT use this to time my entry or exit out of stocks. I prefer to use the individual charts of stocks to do that. However I find it useful in helping us determine how aggressive/cautious traders should be in their trading. In short the more positive the broader market is the more risks you can take and vice versa.

US / S&P500

Not a great week for US Markets. Reporting season has thus far failed to excite with stock-standard reporting and the ‘good news’ is ‘bad news’ phenomenon of US GDP Growth at 4.9%…

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Badgersbrook

30th Oct '23

Hi Elio. A stock with no current momentum but quite the sizeable dividend is Terracom (ASX:TER) which you did an article on about a year ago since when the share price dropped significantly but has since stabilised. Any thoughts on taking a punt on it now? If only for the dividend?

Elio D'Amato

I held TER during the Coal boom of Oct/Nov 2022 and eventually lost money on the trade. Being stopped out when the price gapped down to around $0.60 odd cents. I lost quite a bit of paper profit actually.

Just on the Friday they released their annual report and will be due to report quarterlies tomorrow. The company is focused on total shareholder return, and while the dividend looks outstanding, part of that has to do with the crunch in price. I think the best investors can hope for from the quarterly dividend is 3 cents, and same for the next quarter after. This would take the yield to 28%. Either way I think historical rates are a stretch.

While this still looks high, the other major problem is the life of mine for the Blair Athol project is about 9 years (it also has South African pops of similar length). I had hoped by now with that cash balance the could have done something with those funds. The BHP sale of Blackwater and Daunia were possibilities, but they were outbid by Whitehaven. Perhaps if they had kept more cash that would have helped? (Not that I know if they were in the market. Its just that it is QLD based is how I made a connection.)

Either way I see no need to rush in this. Let's wait for the Quarterly Activity statement. And even then in my eye it needs to get back above 54 cents to get back to the starting blocks.

Grandslam

4th Nov '23

I've most likely missed the cut off, but in case I haven't, I'd be interested in any thoughts on Neuren Pharmaceuticals (Neuren Pharmaceuticals (ASX:NEU) from a momentum perspective, particularly considering the inverted hammer candle on Friday following the encouraging Acadia sales update. Should it be viewed as a breakout, or does the fact that it closed near the low of the day call for caution.

5th Nov '23

Unfortunately Grandslam, we did miss the cut off. And you are right, not normally the behaviour you want to see in a breakout. But it did close above the previous short term lower higher, so that is a positive. It may pullback given Friday's action and fill more of the gap which actually could be a good entry short term entry point... then it just needs to hold $10.18 at all cost ! Excellent question.

Thanks Elio!

Momentum Monday 30 October

Broader Market Sentiment

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Elio D'Amato

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