ERN - Erongo Energy

[Sean K]

Fundamentals no change so must go to the chart.

Gotta say, the past 2 weeks have been particularly bullish for this. Lots of tails on the candles indicating great buying support.

While I think it may have run ahead of it's self the past week or so as indicated in last chart, I've been considering that it may be just starting a new, more bullish trend. The past week which has seen it jump out of long term trend, could be the start of a new trend? Maybe.

On this 3 month chart you can clearly see the latest bullish move out of the long term trend. Also, note all the candles with long tails on them (green mark underneath each) indicating that buyers came in every time the stock came off a little. 2 of the candles without tails were actually positive days, so there is only one day since 30 Mar, and the breakout, that has not been bullish.

Maybe I've taken profits too early? Maybe I'm too concerned about the XAO? I guess we'll find out in the coming weeks.

 

[Halba]

Re: profits too early. Hard to say. But your technical abilities will allow you to reenter if you called it wrong. ERN is still early days I'm sure you'll make the right decision. So far no fundamental change, and going up steadily.

 

[svensk]

kennas, if you note the 1 year daily chart, the current price action is still part of a larger uptrend (albeit hovering around the upper trendline). if you take on this perspective, then perhaps your exit was well timed.

Perhaps any upcoming announcement regarding drilling results will result in a breakout from this uptrend, and produce an acceleration in the trend much like the one seen in the above 3 month chart.

 

[JWBH01]

A few reasons why it is going up:

1 - Recommended in a German tip sheet newsletter (a reputed one, think like Dines newsletter for Americans which tripled ACB and WMT's share prices).

2 - Drilling about to commence.

3 - Other new details/mineral sands/ in quarterly report due end of April.

Maybe this needs a recommendation here similar to Germany. I actually got my mates who's dad works at JB Were to run it by someone there to see what they think, still haven't heard anything, not sure if I will hear anything. Thought it was worth a try.

 

[svensk]

As an addition to my previous post, here are my musings regarding the prospect of a future short term retracement of the SP. Given i'm only new to TA, feel free to take them with a grain of salt. If this is more suited for its own thread in the beginners lounge, could an admin please move? Thanks

1. Trendlines - The SP is straddingly the upper trendline. Short of a breakout above this trendline, it is probable that the price will retract back within the usual range of the trend.

2. Bollinger bands - The SP has recently penetrated the upper bollinger band and is remaining around the edge. Time for a downward movement of the SP toward the middle of the bollinger bands?

3. Oscillators - MACD and RSI approaching overbought levels. How long can current levels be sustained for before they reverse back toward the midpoint line? Also the longer macd line is approaching the shorter, thus the possibility of a dead cross forming. This can also be seen between the two EMA lines.

4. Divergence - There seems to be an apparent divergence between the increasingly higher highs and the decrease in volume and macd histogram. This point i'm not so sure about, as my knowledge of divergence is somewhat limited. Does a divergence of this sort not indicate a future trend reversal?

Granted the analysis is not that in depth, but it seems to me each point indicates a share price retracement, at least in the short term (that is without any major announcements). For those of you who are more knowledgable in the area, feel free to point out any points I have either misunderstood, or totally missed out. I appreciate any feedback.

 

[Sean K]

1. Trendlines - The SP is straddingly the upper trendline. Short of a breakout above this trendline, it is probable that the price will retract back within the usual range of the trend.

I think your top trend line is out. See my earlier 1 year chart and compare. This recent rise, is not part of the long term 'trend'. YET.

 

[captjohn]

I think your top trend line is out. See my earlier 1 year chart and compare. This recent rise, is not part of the long term 'trend'. YET.

Yes I agree with you kennas....your upper trendline has a lot more 'touches' & therefore most accurate.

ERN is changing from a trading range... & breaking out into a stage 2 chart which may trend up sharply based on info & fundamentals that JBWHO1 has just posted.

Its still very early days for ERN now & I'm holding my shares..... I bought coz they're about to start drilling.
Namibia was once a German colony known as South West Africa...so 'wunderbar' to see it listed on the German exchange which will drive sp up snell snell !!(Quickly quickly !!...haha )

Also ERN will get noticed a lot more when Bannerman announce the extent & size of their u308..

Then analysts will realise just how quick mines in Namibia can get into production compared with Australia !!

 

[svensk]

Thanks guys. I'll adjust the trendline accordingly.

In regards to the other points mentioned, do they seem valid for the prospect of a short term retracement? In my view, they're hard to look past.

 

[bliimp]

Came across an interesting article on Gunson Resources of Western Australia; who had to endure a 4 year Environmental Protection Authority process to mine zircon … not uranium.

Refer to the link below

http://www.gunson.com.au/files/reports/MR Government Approves Zircon Mining at Coburn 26 Mar 07.pdf

To quote … “We have worked very hard with Federal, State and local governments, the local community, environmental groups and other key stakeholders to ensure that the unique environmental values of the Shark Bay World Heritage Property and the broader region are protected and conserved for future generations, while ensuring the economic and social benefits of the Project are shared with the local community”

Even if this coming week Labour does away with their 3-mine policy, the administrative red tape in Australia will still be there – be it environmental or aboriginal or heritage.

When you consider that the Rossing uranium mine started operations in 1976, that is well over 30 years ago, and when you consider that Namibia has been very stable in all that time, I am beginning to get extremely confident with most of the Namibian explorers, in particular Erongo and Bannerman.

The above just reinforces Captain John’s assessment.

 

[chris1983]

Came across an interesting article on Gunson Resources of Western Australia; who had to endure a 4 year Environmental Protection Authority process to mine zircon … not uranium.

Refer to the link below

http://www.gunson.com.au/files/reports/MR Government Approves Zircon Mining at Coburn 26 Mar 07.pdf

To quote … “We have worked very hard with Federal, State and local governments, the local community, environmental groups and other key stakeholders to ensure that the unique environmental values of the Shark Bay World Heritage Property and the broader region are protected and conserved for future generations, while ensuring the economic and social benefits of the Project are shared with the local community”

Even if this coming week Labour does away with their 3-mine policy, the administrative red tape in Australia will still be there – be it environmental or aboriginal or heritage.

When you consider that the Rossing uranium mine started operations in 1976, that is well over 30 years ago, and when you consider that Namibia has been very stable in all that time, I am beginning to get extremely confident with most of the Namibian explorers, in particular Erongo and Bannerman.

The above just reinforces Captain John’s assessment.

Thanks for the post blimp. I bought Australia's Paydirt magazine for April and there is an interesting article titled "Why Aussies in Namibia will be first past the post"

Ill take a section out from the article. It points to faster production in Namibia. Its a full page article

"This is expected to be a three-way race between a trio of companies exploring next door to Paladin's Langer Heinrich in Namibia. They are Bannerman Resources (to the north), Deep Yellow (to the South) and Nova Energy Ltd (to the west).

With no delays, like Australia, to mine uranium in Namibia, construction could start within 18 months."

You could also add Erongo into the category of companies able to start up a mine faster than Australian explorers. All in all this article is good for all uranium explorers in Namibia.

 

[Halba]

huh? NEL is very grassroots. It doesn't even have any exploration results in their namibian tenements. These paydirt fellas know much less than people on this forum.

 

[chris1983]

huh? NEL is very grassroots. It doesn't even have any exploration results in their namibian tenements. These paydirt fellas know much less than people on this forum.

Yeah I think they were just mentioning some of the uranium explorers in Namibia. They left out Erongo though. Maybe they havn't heard of them yet? Like a lot of other investors. ERN is still an unknown to most people. All in all its a good article for BMN. Any positive effect on BMN/PDN etc usually runs off onto Erongo.

 

[Go Nuke]

So are there any guess on a possible entry {or re-entry for those of us that already hold ERN} point?

Going by my charts I would put it at around 78- 79c mark.

The next point would be 73c which is where it closed at on the 30th of March, however Im not too sure that I could see a reason for it to fall that far.

 

[Halba]

Worrying about a few c here and there doesn't matter go nuke.

If I worried about a few c here and there I would've missed the ERN train.

 

[nizar]

Worrying about a few c here and there doesn't matter go nuke.

If I worried about a few c here and there I would've missed the ERN train.

Exactly.
Agree wholly.

For me -- the ones I tend to top up or enter, they immediately go south and take a breather for a while -- the ones which I wait for a pullback, it never happens!

 

[Halba]

nizar and others:

i was very successful in this stock purely because i never hesitated. First smallish entry was 45cents, back in the 'spec' days when it was just grassroots. Me and chris got in a bit early. However it was my key entry just below sixty cents that did it. And i entered properly >100,000 shares. Lucky i didn't worry too much about 1 or 2c. I saw many ppl bidding 58-57c in the hope it went down there, so i bid 59-60c. Those people worried about 1c then, may not have jumped on properly, and missed about 30c run(with more to come most likely). In terms of $ saved, if you are buying 100,000 shares, that is nearly 30 thousand dollars. So not worrying about 1 or 2c saved me that much. It looks like still early days for this company with a market cap below the average of peers.

PS: Am looking to add more into Erongo now, I feel its on a solid run here. But i note there is a lot of manipulation in this stock. The 200k bidders come in, and seem to disappear, and come back in. Cycle seems to repeat depending on their mood. These can take it back to low 80s, late 70s, if they disappear. I've done better in this stock than BMN so far purely because of entry technique/not worrying about a few c.

You can have all the fundamentals in the world(BMN), and all the knowledge, yet it does not help in entries. hopefully my torrid time with picking the tops of BMN will be solved by time in the market.

 

[nizar]

Yeh to be honest i never wait in the depth.
Who cares -- entry is of least importance.
Exits and money management (position sizing) are far more.

 

[spooly74]

Also ERN will get noticed a lot more when Bannerman announce the extent & size of their u308..

Then analysts will realise just how quick mines in Namibia can get into production compared with Australia !!

Hi CaptJohn,

I have seen this mentioned before and am wondering how exactly it`s quicker to get a uranium mine up and running quicker over there.

Is it because the Gov are simply pro U mining, and that labour costs are cheaper?

The only comparison is PDN`s Langer Heinrich which went from completing pre feasibility study in Feb 2003 to production about 4 years later.

I would think that some Australian miners would have 2010 or 2011 in their sights too.

cheers

 

[Halba]

Don't think its that bad captnjohn. Govts such as South Australian govts have demonstrated willingness to fast track approvals processes(see AGS example, also Honeymoon mine by SXR uranium 1). So pretty much it is still possible to get a uranium mine quickly here in Australia, provided governments are proactive and lenient.

 

[mildew79]

There is no resistance past 86 cents. 'Sophisticated Investor Stock.' LOL.

Fundamentals no change so must go to the chart.

(I've taken some profits)

summed it up nicely there kennas. i also took some profits fri and shall be looking to get back in at a lower risk level in the near future. overextended short term indicators shall mean an agressive rally unlikely at this stage (a lot of entries / buyers shall be a little weary until these indicators improve).

additionally, it is my experience speckies can really be cooked on bad news or a market correction when indicators are in an overbought position like ern currently.

imo(short term) needs some time to bring indicators back to a safer level.

bmn is oversold atm and has a short term support. with profit takers gone, my U play money shall jump to them at or near this short term support.