Allied Minds: the key number to look out for
Its share price has experienced a pretty vile time, but our chartist wonders if things could change.
11th August 2020 09:58
by Alistair Strang from Trends and Targets
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Its share price has experienced a pretty vile time, but our chartist wonders if things are about to change.
Allied Minds (LSE:ALM)
Every now and then, we're asked about a share we've never heard of. Technology investors Allied Minds (LSE:ALM) based in Boston, USA and a member of the FTSE 250, certainly fitted the bill, justifying a few moments research.
Their "About Us" website section proved fairly assuring, with the range of companies financed being wide and potentially quite fruitful in the longer-term.
To be honest, their portfolio component, a company called Spin Memory, sent us down the rabbit hole and led to many fascinating "I didn't know that" moments.
However, by many standards, Allied Minds’ share price has experienced a pretty vile time since the heady days of 2015 and a share price of above 7 quid.
Presently trading around 42p, many investors must be praying for ‘bottom’ but suspecting logic isn't on their side.
We're pretty interested in the near-term, as it appears the share price needs only to trade above 45p to become useful, this risking triggering a slight recovery to an initial 58p.
At this level, things become crucial for the longer-term thanks to the confluence of two downtrends in January this year.
The green downtrend dates back to 2015, the blue downtrend dates from 2017. In January this year, the market gapped the share price down, ensuring the price did not break free from its brutal tumble.
A few months later, things changed and we're now justifiably interested should the share price manage to close above this trend, confirming its moment earlier this year.
The key number looks like 55p - the share needing to actually close above this level to suggest a longer-term growth cycle is commencing.
While we're hopeful moves above 45p shall bring the price to 58p, if this motion indeed proves capable of allowing the share to close above 55, we can calculate a secondary recovery target at 90p.
Or perhaps even 147p, if movement is driven by positive news flow from the company.
If trouble comes, the price needs retreat below the blue downtrend, presently 27p. Any nod below this level would justify extreme panic.
Source: Trends and Targets Past performance is not a guide to future performance
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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