# ERG has flatlined...some TA studies



## stockGURU (23 February 2005)

I'm not an expert on ERG but it doesn't take a genius to notice that the share price doesn't seem to be going anywhere in a hurry.

Anyone care to air their views on what is keeping ERG down?


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## ghotib (24 February 2005)

*Re: ERG has flatlined...*

Is there any particular reason for it to go UP, aside from general market movement?  Last time I looked they were working on some major projects that were not yet delivering revenues. I can't remember estimated completion dates; I've got a vague idea some must be by June but I could be making that up. Anyway, I wouldn't expect much share price movement until those projects start delivering revenues, or else are so late that the company goes bust. We're still holding.

Cheers

Ghoti


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## shichen (1 March 2005)

*Re: ERG has flatlined...*

ERG just raised 64m via right issue, the key is cost cutting. All ERG project required heavy initial capital investiment, cash flow will improve when the project is completed. The company is looking good, 2004 they wil be back in black, from here on, it is a ride up.


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## Aussiejeff (1 March 2005)

*Re: ERG has flatlined...*

Last night's half year report looks pretty positive. A BIG turn around in profitability. Wonder what the 'punters' will make of it..... I've put it on my watchlist for now.

AJ


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## RichKid (1 March 2005)

*Re: ERG has flatlined...*

ERG has broken out on tremendous volume, above 35c resistance at the moment on good buy depth. Ascending triangle breakout, next stop 45c then resistance at 50c but we'll have to see if it finds support at 35c first, it'll move fast imo if this volume is anything to go by. 

A good candidate, I'm thinking of entering, this looks like one that has turned the corner, it appears that people were waiting on the financials before buying in, hence the long period of slow uptrend over the last few months.  Any longtime watchers that have confidence in management? 

I'll post a chart later.


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## RichKid (1 March 2005)

*Re: ERG has flatlined...*

A strong finish with 42m+ traded, an all time high for volume. Closing at 36.5c, above what may now be support at 35c. Ask is now 37c, need more buy depth though for this to run straight up.

ERG would have come up on people's scans today so we'll see some more support tomorrow imo. A nice candlestick pattern, I'll post the chart tonight if someone isn't able to before then. Still need to see how it holds over the rest of the week to be sure of breakout, odds are in favour of it.


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## Joe Blow (1 March 2005)

*Re: ERG has flatlined...*



			
				RichKid said:
			
		

> A strong finish with 42m+ traded, an all time high for volume. Closing at 36.5c, above what may now be support at 35c. Ask is now 37c, need more buy depth though for this to run straight up.




Today's turnover looks to be about double the all time volume in fact.

I took a punt today and got set on ERG at 35c. The next few days trade will certainly be interesting. ERG has been in a steady long decline since the dot com days but this return to profitability and the recent New Zealand contract (amongst others) seems to have restored some confidence in it's medium to long term prospects. I saw a lot of frenzied at market buying today, that combined with the abnormally high volume and the recent good results may well be enough to give it some solid momentum in the short term at least.

One to watch over the coming weeks for sure.


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## DTM (1 March 2005)

*Re: ERG has flatlined...*

ERG gets my vote as well although I'm not in it.  Looking at the Oscillator, the pressure was building to go up.  I came to that conclusion before seeing today's price movement and reading the previous posts.  

Hopefully it'll keep skyrocketing up for you all.

 :drink:


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## RichKid (1 March 2005)

*Re: ERG has flatlined...*

ERG seems to have saved itself, many promising IT co's overstretch themselves, just having a great idea or product or technology wont do it unless you can run the co as a profitable business. They seem to be reigning things in and from the last annct appear to be on the way to net profits. Is it right to say they got a new CEO/Chairman last year? 

Too early to call yet for me technically, will also have to do some fundamental research to see if this is worth staying in if the breakout continues.

Anyone know of any broker reports or other reviews of ERG recently?


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## RichKid (1 March 2005)

*Re: ERG has flatlined...*

Charts of ERG, let's see if the TA holds true:

1) 12 mth daily- downtrend broken, base formed, price recovering
2) 6 mth daily- ascending triangle, breakout on huge volume, gap, shaven candle
3) Intraday- break of resistance on volume and close at high on volume


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## Aussiejeff (2 March 2005)

*Re: ERG has flatlined...*

I'm in at 34c.

Holding on with fingers, toes and eyes x'd!!!

AJ


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## RichKid (2 March 2005)

*Re: ERG has flatlined...*

Strong open today, gapped, volume very solid again, I managed to get in at the close yesterday. As Joe observed yesterday there are quite a few at market orders going through, clearly a bit of a frenzy. Vol approaching 6m already and price at 38.5c.

 It'll be good to see 20-30m in volume today. Buy depth is good, especially with so many buying at market. Things should settle a bit before long. It'll be interesting to see how it moves in the last hour of trade.


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## RichKid (2 March 2005)

*Re: ERG has flatlined...*

A weaker day today, started storng as expected. Still early days and it is above 35c. A weak close but volume is still high for this stock.


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## RichKid (3 March 2005)

*Re: ERG has flatlined...*

An article on ERG's recent financials, done by a co spin doctor I think. I'm still looking for a more critical evaluation. To my untrained eye it looks like the co has turned around, I like the fact that they're now concentrating on high margin ventures and cost reduction. 

As long as the headline profit figure is not a piece of accountaing chicanery it should get better from here on (touchwood). It'll probably take another week or so before the analysts wade through all the recent reports (including ERG) so stay tuned for commentary by brokers. I'll follow the charts till then. http://www.emediawire.com/releases/2005/3/emw213480.htm


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## RichKid (3 March 2005)

*Re: ERG has flatlined...*

Not a pretty day for ERG, as long as it stays above 35c it'll be ok imo. Today and tomorrow will confirm it as we'll have several bars and some volume trends to look at. Certainly edging towards a weaker than expected breakout, might just consolidate and wait for some news to spark it upwards again, can't blame shareholders for being cautious after the recent sp trend. Let's see how the eod prices go.


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## kooka1956 (3 March 2005)

*Re: ERG has flatlined...*

I have followed ERG for a few years now and even picked the stock in the monthly comp. a few months ago.Their last new issue basicaly got rid of all their debt plus they have money in the bank.Making a profit is certainly a bonus.I reckon things should steadily improve from now on,particularly in light of contracts maturing over the next 18 months. Regards  KOOKA


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## RichKid (3 March 2005)

*Re: ERG has flatlined...*

ERG intraday for today (Thursday). Nice to see it close at support. Let's hope it stays that way and doesn't change to resistance again. Some new orders came in towards the last two hours of trading to buy at 34.5c and above- let's just call it the smart money for now ; )
My stop is close, market may not notice ERG till next week.


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## taurus (3 March 2005)

*Re: ERG has flatlined...*

I inherited this stock wayyyy back when, when it actually held some value.  Problem was I couldn't sell, as portfolio control wasn't in my hands....

Does anyone think it would be silly to purchase more ERG at a lower price, to somewhat counter the losses made previously (betting on the fact the price will rise)?  Of course I'm not asking for financial advice   just personal opinions on a somewhat hypothetical situation. Would really appreciate any response.


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## RichKid (3 March 2005)

*Re: ERG has flatlined...*

Hi Taurus,

As you know I can't provide advice (even if it was worth listening to) but I can tell you why I bought as explained above. For TA reasons it appears to be a breakout. 

I am waiting for confirmation of 35c as a support level before getting comfortable, I wouldn't be surprised if it falls below 35c before making a convincing break higher as that sometimes occurs with premature breakouts. A number of the bears appear to have been shaken out recently. Last bar is not the best but we'll have to see how it pans out. If ERG truly regains its former stature missing out on a few cents here and there on an uncertain breakout won't mean much. I was in two minds whether to buy on breakout confirmation or at the initial breakout- I chose the latter, higher risk.

Personally, I don't average down. I'd view this entry as a completely new one and consider whether I'd buy in as if I didn't have a holding already. Then there's position sizing and portfolio diversification etc as well but that's something you'll have to consider with a financial adviser and an accountant. Different people have different strategies. 

Again, you'll have to make an informed decision by relying on you own research- good luck and keep posting!


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## RichKid (4 March 2005)

*Re: ERG has flatlined...*

A better start today, holding above 35c so far, the EOD intraday chart will tell all.


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## RichKid (4 March 2005)

*Re: ERG has flatlined...*

Intraday chart, only reason I'm posting these is to get a feel for the pattern as we observe this important stage in the price action, will it or won't it be the turning point for ERG? Let's hope it is and have our stops in place in case it isn't. Anyone find  the intraday's useful? Nice to see that white candle today but not exactly the most bullish type. Holding above 35c but not enough buy depth- buyers always appear when things look bad just to prop it up, must be a few on the sidelines or daytraders in for a quick bite.

ERG appears to have become more stable with consensus just above 35c today- also reflected in the last few days prices.


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## RichKid (7 March 2005)

*Re: ERG has flatlined...*

A weak close but looks like there's some agreement that 35c is the floor (atm).


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## taurus (8 March 2005)

*Re: ERG has flatlined...*

Spec buy? or a wait-and-see.

news article 

Wouldn't mind knowing how strong their DCS's are versus the competition.  Like with Cubic Corp winning a Sweden contract that I'm sure I heard ERG was bidding for...I don't know how much competition they have this time round.

Will be interesting to watch...I'm tempted to buy, but hesitant.

T


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## RichKid (8 March 2005)

*Re: ERG has flatlined...*



			
				taurus said:
			
		

> Spec buy? or a wait-and-see.
> 
> news article
> 
> ...




Thanks for the link T, that really is a great article, worth reading, MD Sullivan certainly seems to be a no nonsense, roll-up-the-sleeves type of guy, he's done a lot in the short time he's been there judging by the numbers. It's going to be hard yakka but if they get that Victorian contract next month ERG should get going as the analyst suggests. A breakout from the current range would probably be a safer entry too but that's just my view.
Let's see if we can get our hands on some analyst reports over the next few weeks...


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## RichKid (8 March 2005)

*Re: ERG has flatlined...*

Here's the intraday again. Not showing much of a change so I'll just stop for now. Again closing lower as agreement is just above 35c. Recent increase in top buyer depth is notable so 35c appears to be confirmed, for now. Must be waiting on the Melbourne contract result.


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## stockGURU (9 March 2005)

*Re: ERG has flatlined...*

ERG looking good again this afternoon. 

Volume is high and it looks as though it may finish the day strongly.

It will be interesting to see if it can break through resistance at 40 cents.


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## RichKid (9 March 2005)

*Re: ERG has flatlined...*



			
				stockGURU said:
			
		

> ERG looking good again this afternoon.
> 
> Volume is high and it looks as though it may finish the day strongly.
> 
> It will be interesting to see if it can break through resistance at 40 cents.




Hi Guru,
Yep, sure is a goer atm, flag breakout, measured move, closed at 39c on very high volume again, volume pattern corresponds to breakout too. Maybe I'll post another intraday chart tonight. Looks like it's going to say a final goodbye to that bottom formation, ain't over yet though....


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## ghotib (9 March 2005)

*Re: ERG has flatlined...*

I'm really fascinated to read a technical discussion of this stock, which I've been watching for some months as a long-term income generator. I've now had 3 different viewpoints on it:

1.  My partner in life put some windfall cash into it in 2002 because of the strength of its products and their market. Ooops - necessary but not sufficient.  (No complaints from me though: another windfall several years ago went into Newcrest.) 

2.  I took a long look last year and liked the way the company's performance has aligned with management plans and forecasts for four years. If I'd had some spec cash I might have bought in at about 29 cents, though I think when I first posted about it here I was hoping for 23 (well who wouldn't). 

3.  Now the technical signals seem to be that it's going for a bit of a share price run. I don't see that the company performance justifies that yet: the last reports I've seen forecast tight cashflow till at least 2006, and the company still has to demonstrate that its learnt how to deliver large projects profitably. So I think a surge now would be purely trading, and not yet the start of a consistent uptrend. 

Very interesting, and a nice lesson in the importance of being very clear with myself about why I'm making a trade and what the stock has to do to stay in my portfolio.

Thanks to all

Ghoti


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## RichKid (10 March 2005)

*Re: ERG has flatlined...*

Hi Ghoti,
Yes, different views, this one isn't a certainty yet but it's getting there. Different views are what make a market. The bottom line is you've got to be comfortable with your strategy, glad to see interest picking up in this stock, there seem to be some long time holders/watchers around. I have to say this isn't my safest stock for FA profile but the breakout looked great and IT is getting in vogue again, it's the profit annct that did it. A contract or two and the market will give it a second chance. I'll probably book a quick profit if FA looks shaky, but still too early to say if I'll come out ahead.

Here's the intraday, solid close. Buyers aren't alwasy obvious from mkt depth so volume is more reliable.


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## stockGURU (10 March 2005)

*Re: ERG has flatlined...*

Buy side depth building up nicely this morning with an hour and a half before the open.

Buyers  
Number Quantity Price 
1 100000 0.430 
3 33500 0.420 
1 50000 0.405 
10 295750 0.400 
12 660500 0.395 
17 550230 0.390 
17 1001966 0.385 
23 945713 0.380 
9 196500 0.375 
18 405500 0.370 

Sellers
Price Quantity Number 
0.390 16065 3 
0.395 612327 8 
0.400 404149 22 
0.405 386060 6 
0.410 643698 14 
0.415 218750 2 
0.420 348347 16 
0.425 240000 4 
0.430 129873 10 
0.435 88000 5 

One to watch this morning.


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## tech/a (10 March 2005)

*ERG*

For Interest.


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## RichKid (10 March 2005)

*Re: ERG has flatlined...*

Intraday, strong close, let's see if this continues, looking good...


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## dutchie (10 March 2005)

*Re: ERG has flatlined...*

Nice day to day analysis there RichKid.

As predicted.

Hope it keeps going north.


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## RichKid (10 March 2005)

*Re: ERG*

Hi Tech,
Great chart, very interested in following the thread. Quick question- are you hoping to do something different with this thread on ERG (ie technical look at measured moves only?), reason I ask is because I was thinking of merging it with the current ERG thread to keep things organised. Not sure if we have a multiple threads policy so I'll see what Joe says. A special project probably deserves its own thread but if it's the same stock we could merge it. Just adiministrivia, let's wait for Joe...and your thoughts Tech.


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## tech/a (11 March 2005)

*Re: ERG*

Didnt know there was an ERG thread going.

Happy to see it moved to there.
The Measured Moves are just added for interest,like all tech analysis sometimes they are accurate others they are less than accurate.


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## RichKid (11 March 2005)

*Re: ERG*



			
				tech/a said:
			
		

> Didnt know there was an ERG thread going.
> 
> Happy to see it moved to there.
> The Measured Moves are just added for interest,like all tech analysis sometimes they are accurate others they are less than accurate.




Tech,
Okay, done! (also see two old threads on ERG linked at the bottom of this page). 

My initial view was that you measure a flag breakout from the point where it broke out (ie last bar high before breakout) upto lower end of flag and then you measure that distance from the point where the next flag breakout commences to get a target- make sense? That would be the minimum move to be expected, if it holds to form. Only issue is some flags are hard to draw clearly so the measurement may vary depending on how you draw the lines. Maybe there are many methods or I may have misunderstood the method, I'll keep researching it. Thanks for you diagramme, makes it clearer to read (unlike my posts).


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## RichKid (11 March 2005)

*Re: ERG has flatlined...*



			
				dutchie said:
			
		

> Nice day to day analysis there RichKid.
> 
> As predicted.
> 
> Hope it keeps going north.




Hi Dutchie,
This one did all the work on its own after the first few days- which was when it needed close supervision!
Let's see if it keeps going, nice volume is very encouraging, Tech/A will be adding his invaluable observations too so let's see if we can predict how this goes- Technical analysis has a nasty way of biting you when you get too comfortable with it, so I'm very wary.


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## tech/a (11 March 2005)

*Re: ERG has flatlined...*

Some correction needed.


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## dutchie (11 March 2005)

*Re: ERG has flatlined...*

Tech/a

Would you mind explaining your chart a bit more -I am a bit slow and can't follow it. 
Where did the 10c come from, the second green arrow?


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## dutchie (11 March 2005)

*Re: ERG has flatlined...*

Tech/a 

Our posts overlapped! 
Think I understand it better with your second diagram.
So first 9c move is measured from the last low(29.5) and the high (38.5) at the last +ve movements. Then the next move could be 1x, 1.5x or 2x (9c,13.5c or 18c) from the low(34.5) after that high?


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## tech/a (11 March 2005)

*Re: ERG has flatlined...*

Thats it dutch I have some old examples home and ill post them later.

They show the idea over a length of time this however is not hindsite but on going live analysis.


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## RichKid (11 March 2005)

*Re: ERG has flatlined...*

Looks like ERG is cooperating with your analysis Tech, heading in the right direction. Was even on the Comsec sells list for awhile this morning (always a good sign, looks like comsec traders sell stocks while they are going up- d'oh!).


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## dutchie (11 March 2005)

*Re: ERG has flatlined...*

Not this one RichKid 
I'm in for the long haul - hopefully


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## RichKid (12 March 2005)

*Re: ERG has flatlined...*

ERG intraday for Friday.


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## stockGURU (17 March 2005)

*Re: ERG has flatlined...*

Bad news for ERG today:



> IBM / ERG Tender Update
> 
> In accordance with Listing Rule obligations, we wish to advise as follows.
> The Transport Ticketing Authority (TTA), part of the Department of Infrastructure in Victoria, has advised that it will not be continuing further negotiations with the consortium to which ERG is a subcontractor in the lead up to selecting a preferred tenderer for its new public transport ticketing system. ERG will consider alternative options ahead of a final decision.




ERG down 20% to 34 cents, unfortunately closing below 35 cents which had been where ERG seemed to be finding some good support early last week.

Not looking good in the short term. Any comments?


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## el_ninj0 (17 March 2005)

*Re: ERG has flatlined...*

Ouch for short term. Prediction (which is based on nothing but instinct) is that it will go down even more tommorow, sit at between 20-25 cents for about 1 month.

Remember, thats pure speculation, and could very well be wrong.


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## ghotib (18 March 2005)

*Re: ERG has flatlined...*

You there Tech?  RichKid?  I'm very curious to know what the chart suggests to  you guys after today?

IMO, on the fundamentals there's no reason for the price to be going anywhere except sideways around 30 - 33 cents. This weeks flurry seems to have blown up from speculation that the company might win a new contract sometime this year that might generate revenues some time this decade. Wow! 

But does the chart at today's close -- just noticed the time, I mean yesterday's close -- give any signal that trading might be more interesting than that?

Thanks

Ghoti


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## tech/a (18 March 2005)

*Re: ERG has flatlined...*

G

If its any help I seem to concure from a technical veiw.


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## ghotib (18 March 2005)

*Re: ERG has flatlined...*

Thanks Tech. 

Ignoring the rumours and facts for a moment, how would you have used this chart for trading over the last couple of weeks? I mean things like - if you bought very early in the measured move you posted, where would you have set stop loss(es) and why? Would you every buy on a movement as short term as this one?

Rich? 

Ghoti  (my brain is full)


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## tech/a (18 March 2005)

*Re: ERG has flatlined...*

Id have been caught like everyone else.
Just like BAS.
Even trading short term whether technical or fundamental your going to get belted with gaps down like the 2 mentioned.

Im convinced this is a strong reason why 95% of traders fail as their universe of stocks consist of these sorts of volotile stocks. no matter how close your stop is gaps like these just take them out.

In the breakout thread I think Ill expand the trading ideas and results with a few different ways of trading them.
Im also thinking of running parallel breakouts on stocks $1-5 a portfolio of 10 and $5 + another portfolio of 10.
Trade all the same and see whether my theory of universe selection being  a  major reason for failure.


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## RichKid (18 March 2005)

*Re: ERG has flatlined...*

I got stopped out on this but the gap didn't affect me in the sense that the planned loss was what I took due to entry near support. I'm still not convinced it's over for ERG but I'm staying out as it's got a different risk profile now. The next two days are critical imo. My interpretation is that prices broke through after the profit annct as it signalled the start of a turnaround. The contract is what I believe pushed it further than 40c as people anticipated a major rerating if the contract was won. 

The buy depth is still there but it has to close above 35c, if not I see it falling as TechA shows in the chart. People would think again that the co is where it was before the profit annct ie no strong sign of recovery yet. Hence a major contract win may spur another go at 35+.

BTW, Tech those big blue bars- are they meausures or actual highs? My data suggest prices didn't go that high. I agree wholeheartedly with Tech's comments about the stops and very volatile stocks, only takes on or two in quick succession to stuff up the figures. That's one reason I have predetermined profit take levels for very volatile stocks, it may run further but I prefer to book a reasonable profit, the trick is picking the risk profile and figuring out what drove the price, which is tough.

The good thing about tight stops is you can buy in again if things look much better, you only take a small loss and there's no stress.


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## tech/a (18 March 2005)

*Re: ERG has flatlined...*

*BTW, Tech those big blue bars- are they measures or actual highs?*

Length of the moves they cover the actual bars.


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## The Barbarian Investor (18 March 2005)

*Re: ERG has flatlined...*

Comsec is showing it as a "BUY" is it now time to sell? wonder how a Contrarian view to comsec  would go ?

BUYS-  NWS, TLS, ERG, BIL, CML, BPC

SELLS- BHP, RIO, WRM, AMP, AMC, TAH


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## RichKid (18 March 2005)

*Re: ERG has flatlined...*

It ain't over yet folks, bearish close below 35c but huge buy depth- but it does vary, not always reliable. 
Remember one contract isn't everything, they didn't make a profit out of nothing (but then I haven't done the math but no one has criticised their accounting). Chart shows the volatility and the amount of support. Clearly people are still in two minds about the timing of the recovery ('buy now or wait for more news' or sp would have collapsed imo), hence movement around 35c before closing below resistance. Close above 35 suggests confidence in turnaround, anything much above that is additional good news imo (eg contract win), just a guess atm. I may re-enter as things become clearer. I haven't done that much research on ERG. I'm bearish atm because of two closes in a row below 35c and no pattern to trigger entry.

Today's intraday:


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## ghotib (20 March 2005)

*Re: ERG has flatlined...*

Do you pay attention to the proportion of shares in play, or just to volume trends? If I've understood the data correctly, ERG has about 610million shares issued (Capitalisation $208million / share price 34 cents). The highest day's trading volume was around 40million, which is 6.5% of issued shares. Just looking at the ComSec 12 month chart, average volume looks like about 50K - statistical noise. Isn't that pretty low, and hence pretty risky, for short-term trading??

I have some confidence in this company because management has stuck to its plans and met its forecasts for about 4 years. They had a LOT to do to repair the company and they won't be finished till they've implemented some major, revenue generating projects, which is why I think the current price makes sense and don't really expect to see much change for months. But I don't see the stock as a good candidate for technical trading (unless buying on rumour is technical, in which case I'm out of the loops anyway). Am I missing something? 

Thanks

Ghoti


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## tech/a (20 March 2005)

*Re: ERG has flatlined...*

Ghoti.

Technically its not a trade.
However with 40 million traded someone thinks that those selling are 
selling great value stock.

Sure they would be buy and hold.
It wont be a technical buy until it makes a new high (In my opinion) the real risk now is that this could just labour and do basically very little for ages.


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## RichKid (21 March 2005)

*Re: ERG has flatlined...*

No quick recovery for this one, 35 is a great level to watch now.


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## markrmau (22 March 2005)

*Re: ERG has flatlined...*



			
				The Barbarian Investor said:
			
		

> Comsec is showing it as a "BUY" is it now time to sell? wonder how a Contrarian view to comsec  would go ?
> 
> BUYS-  NWS, TLS, ERG, BIL, CML, BPC
> 
> SELLS- BHP, RIO, WRM, AMP, AMC, TAH




Last year I would say just do the opposite of commsec and you will be rolling in dough. However I have to say that this year, they seemed to have wisened up a lot, and they are not (always) buying duds that have just had a massive drop, or selling at the beginning of a massive up-trend.

I remember looking at the chat rooms last year where someone was saying they sold ANZ after it went up 20c or so. It went on to go up by a few $ from memory.


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## RichKid (25 March 2005)

*Re: ERG has flatlined...*

Poor ERG, looks like it's back to downtrend or at best the current base consolidation pattern. I prematurely thought it had completed the base. Looks like there are a few more stages of it to go yet. This is one to be cautious about, maybe short term trades in it but long term picture is a different story.


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## RichKid (25 March 2005)

*Re: ERG has flatlined...*



			
				ghotib said:
			
		

> Do you pay attention to the proportion of shares in play, or just to volume trends? If I've understood the data correctly, ERG has about 610million shares issued (Capitalisation $208million / share price 34 cents). The highest day's trading volume was around 40million, which is 6.5% of issued shares. Just looking at the ComSec 12 month chart, average volume looks like about 50K - statistical noise. Isn't that pretty low, and hence pretty risky, for short-term trading??
> ................
> Ghoti




Good point Ghoti, I didn't pay attention to it. I think Tech answered the Q.


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## ghotib (25 March 2005)

*Re: ERG has flatlined...*



			
				RichKid said:
			
		

> Poor ERG, looks like it's back to downtrend or at best the current base consolidation pattern. I prematurely thought it had completed the base. Looks like there are a few more stages of it to go yet. This is one to be cautious about, maybe short term trades in it but long term picture is a different story.




Thanking you in advance for your extreme patience, what is a base consolidation pattern? I've noticed on several stocks that you like using triangles and I'm guessing you're talking about the bases of triangles? Or in this case THE base of A triangle? Only I don't see triangles on any of the charts I've tried for this one so maybe it's something else??

Point me in the direction of an appropriate book or website if you like. I'm happy to do my own reading, but this time I don't know what to read.

Ghoti


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## RichKid (25 March 2005)

*Re: ERG has flatlined...*



			
				ghotib said:
			
		

> Thanking you in advance for your extreme patience, what is a base consolidation pattern? I've noticed on several stocks that you like using triangles and I'm guessing you're talking about the bases of triangles? Or in this case THE base of A triangle? Only I don't see triangles on any of the charts I've tried for this one so maybe it's something else??
> 
> Point me in the direction of an appropriate book or website if you like. I'm happy to do my own reading, but this time I don't know what to read.
> 
> Ghoti




Ghoti mate, we're both in the same boat, except maybe I'm half an inch ahead of you in terms of TA knowledge so don't feel shy to ask, we're all learning. Basically you can read 'base' as bottom imho, except that it's hard to pick a bottom and sometimes you get it wrong so it's better to wait till it's completed (the reversal) and then describe the general turnaround area as a 'base' or support area.  Conceptually it's like a 'support' for a stool (ie the leg/s or like a hand propping up something,  hence prices are supported in an upwards direction. Hence the flattening out of the sp since July 2004 would indicate the price is being supported, the breakout in my previoius mistaken opinion was the completion of that base; events have since suggested otherwise.

I was really intrigued by Regina Meani's charting on bases- see her book (3ed) on Charting (most libraries or bookshops will have it). It's a bit brief but explains a bit about bases (from memory) as do most other TA books. The best place for examples are old copies of Shares mag where she has a regular column, lots of examples with lines showing where the bases have been charted (her commentary is good too). Each chartist has a particular style and she seems to be peroccupied with bases. And yes, 'base' can also be used to refer to the base of a triangle but not for this purpose. I also draw triangles a lot because that's about all I can spot easily at my stage of charting. There is an ascending triangle (top side horizontal at 35c with lower side rising upwards to the right- see if you can find it from my earlier posts).
Hope I haven't messed up the description, maybe TechA or other chartists can elaborate, maybe they disagree as to whether this is a base.


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## emu2 (26 March 2005)

*Re: ERG has flatlined...*

Reason > Company history since founded. False promises!


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## RichKid (26 March 2005)

*Re: ERG has flatlined...*



			
				emu2 said:
			
		

> Reason > Company history since founded. False promises!




Certanly looks like it as they seemed very positive about the Melbourne contract and got kicked out weeks before the end. The new mgmt is what may give ERG a second chance, all the write ups on ERG that I've seen are negative about track record. It's upto the new CEO to prove his worth or I don't think he'll be around for long. The sp doesn't lie in this case.


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## tech/a (26 March 2005)

*Re: ERG has flatlined...*

TECH VEIW


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## RichKid (30 March 2005)

*Re: ERG has flatlined...*

Some bad news on ERG, just saw an article in the current Personal Investor (April?) mag about great stock picks by StockDoctor and they have ERG at the bottom as one to avoid. Their analysis is based on several factors and on almost all counts ERG appears to fail- fundamental financial reasons are what are used in the main. If I'd known about that I'd have booked a quick profit instead of waiting for further gains during the 'false' breakout. I placed too much emphasis on the 'profit' annct.

I expect to go lower as that's where it's been consolidating, maybe even below the lower box indicated by Tech.
Tech, when you say you expect it to range- do you mean between the boxes or in the top box??


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## hector (4 January 2007)

Thought ERG was the perfect triangle - now holding with a stop. Have to wait and see...


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## reece55 (7 January 2007)

To be honest Hector, I wondered if anyone was still watching ERG. It has had a stellar 6 months - up more than 300% since August. And WBC have been buying all the way up to about 27 cents, so this one might move further upward for all we know......

It is worrying that one of the subs dumped a whole pile of stock though - however, the reason for the sale was sighted as a change in investment mandates....... HAHAHA.... I reckon they just took their $$$$ off the table.

Certainly one I peek at sometimes..... 

Stats for this share are quite incredible - listed long ago in the nineties, has a peak of $28.00 in the tech boom and has raised next to 700 Mil from investors. As far as I know it has never been cash flow or p&l positive. They burn money quicker than VCR! I tell you what, if you want a laugh, have a look at the strike prices of the options issued..... something tells me some of those will go unexercised...... A ship wreck from the tech boom, I always have a laugh when I look the share. The other one to view LOK..... just as spectacular.... But still listed i note......

Cheers
Reece


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## tt1900 (21 March 2007)

Is anybody still watching this share? I just start trading last year on August, and currently holding this share at 0.21, any suggestions?

Cheers,

Di


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## Joe Blow (21 March 2007)

Just a reminder to everyone that all general discussion about ERG should go in the ERG thread which is located here: https://www.aussiestockforums.com/forums/showthread.php?t=230


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