Why there's hope for Sirius Minerals

Sirius Minerals (LSE:SXX)

Our monthly visit to this lot shows something interesting from a nerd's perspective. Essentially, despite nothing happening, the market has been sufficiently kind to confirm which trend it's working against. The chart for Sirius Minerals below is a bit fascinating.

Essentially, and though nothing has really happened for the last month (aside from it hitting our useless 28p target), we're taking some hope from the salient detail our target was slightly bettered intraday. When this happens with a share price trading above its downtrend, invariably it paints a picture for some positive movement ahead.

The inset "proves" the trend, showing the price closed hard against it prior to the next trend break. Once the trend was bettered, it back-slipped a bit, but some care was taken to stop the price once again retreating below the downtrend.

Unfortunately, despite the trend being confirmed, the price has moved slower than the UK Prime Minister addressing a problem.

Alternately, it also could simply be the case the market is awaiting some important news which shall affect the price.

To get the grotty stuff out of the way first, it appears weakness now below 26.5p could present a dreadful 25.5p! This would trash the immediate uptrend, allowing future slippage to 21.5p and hopefully a bounce, especially due to the dashed red uptrend since 2015.

However, opting to take an optimistic stance makes some sense as it feels like the price is playing a waiting game.

Any upward dash now exceeding 29.5p should find growth toward 31.5p awaiting. While pretty limp, should 31.5p be bettered, then 36p awaits with a strong visual promise for the future if such a level beaten.

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. 

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