How Sirius Minerals can achieve 47p and more

Sirius Minerals (LSE:SXX)

Our prior Sirius outlook expressed some doubts, verging on hysteria, that the shares might actually close a session above 31p to permit confidence for the future.

It certainly managed the lame move from 23p to our initial 26p target without much drama, but, aside from providing a textbook case of "this is why we give two targets" by reversing from 26p, the share price has since managed similar integrity to Mrs May's firm policy statements - temporary at best!

In theory, movements now above just 29p should provoke 31p near-term with secondary, if bettered, at 35p.

Unfortunately, once again we're still demanding the share actually close above 31p and, for a change, we'll explain the logic.

Circled on the chart is a manipulation gap in price movements at 37p. When the share price was forced downward, it created a set of circumstances which insist the price now needs to actually close a session above 31p to exhaust price movements since it was opened at 30p on 2 November last year.

By actually closing above 31p, we're able to factor in forces from the period when the share was trading up to 51p, with these able to impart oomph for some quite strong growth, hence our longer-term pencil marks at 47p and beyond.

Our worry currently is the lack of commitment being given toward 31p. But, to be realistic, the share price needs to drill below 24p to justify any real concern at the lack of growth.

This scenario looks capable of triggering an initial 22p with secondary 17p and the suggestion of a bonk against the long-term uptrend.

For now, we're probably being silly as exquisite care was taken recently to cover manipulation gaps created from 27.25p, so it's probably just a matter of patience. And crossed fingers...

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.

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