Yesterday Sakari drop around 10cts in 1 single day. In my class, a friend tells me Sakari goes down because of Earnings less than expectation. Without researching, I published an article asking telling all to leave this stock because of bad earnings.
In fact after my research, this is not true. Sakari beats earnings expectations on 30th Jul!
http://www.reuters.com/article/2012/07/31/markets-singapore-stocksnews-sakari-idUSL4E8IV1FX20120731?type=companyNews
It goes down yesterday for 2 reasons:
1) there is analyst downgrade by UBS
*DJ Sakari Resources Downgraded To Neutral From Buy By UBS
*DJ Sakari Resources Target Cut To S$1.59 From S$2.55 By UBS
2) The price of Sakari reached $1.50. This is what I called the "Law of Gravity of Price", a magical number like Fibonacci set of number where it needs to rest for at least 3 trading days.
How to play this stock NOW?
In fact, profit take first if you are a short term trader.
When Sakari comes back to $1.535, you may want to get in again, this is what I called consolidation has finished and this stock is about to march on again! If it does not come back to this figure, forget it...
Rgds
Daniel
www.danielloh.com
