Amur Minerals - the magic number

Amur Minerals (LSE:AMC)

Back in the day, we used to hate Mondays, but Wednesday was a day for optimism, a great time to start something new as it could be completed for the weekend. Wednesday has also become 'SPAM' day, literally the worst period for being inundated as a bunch of clowns finally release the rubbish they've spent a few days preparing.

Oddly, while historically the FTSE used to be fairly reliable for positive Wednesday behaviour, nowadays we can be less certain, but this is probably due to a shift in the patterns of international economic announcements.

It's funny, we try as hard as possible to publicise ourselves but discover, despite some stonking results, our most popular Tweet in the last month was; "You've obviously never been bitten on the willy by a Scottish midge!" when answering someone questioning why some Scots hate their own country.

As always, this analogy merges seamlessly into a report against Amur Minerals - but only if discussing itches which cannot be decently scratched.

The magic number for AMC is currently 8.8325p roughly. This represents the blue line on the chart and, with closure above, we can be fairly confident the share price expects some recovery.

Until such a point, we're left with the fear that the price is simply exhibiting internet chatroom inspired exuberance. Don't get us wrong, we're as happy as anyone when a share price experiences 20%-plus sessions, but, invariably, unless it makes it above a trend there are always going to be a bunch of folk who bought at the highest price due to slavish adherence to gossip.

However, there's already a strong argument favouring AMC heading toward 11.75p on the immediate movement cycle. Generally, we're ultra-cautious with this sort of thing until a share price actually closes in recovery territory, but there's little doubt Amur is making most of the correct moves. Should the price continue to perform with some integrity, we can even argue for a secondary above 11.75 at 13p.

At this point, an issue becomes apparent given the prices high back in February. Or, in plain English, we'd expect some stutters at the 13p level, at least until all those suckered into buying at the 17p high of February 10th cash in their shares at break-even or less!

For now, this appears worth watching closely as the price requires to slither below 'red' (5.65p currently) for concern. And anyway, once the share actually closes above 'blue', we'll regard the long-term influence as coming from 20.5p and beyond.

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.