Are Eurasia Mining shares only worth 10p?
19th August 2021 08:12
After a stunning rally last year, Eurasia Mining shares have had a much tougher 2021 and it might be about to get worse.
In a fit of curiosity, taking the time to discover what Eurasia Mining (LSE:EUA) actually mines provided some interesting information, explaining the massive rise and reversal in the share price experienced over the last year.
Modern electric vehicles need batteries, and batteries need specialist metals. Eurasia, by securing sites in Russia, looks capable of producing a strong future for themselves.
The fly in the ointment?
There is something painfully familiar with the share price arc and doubtless many private investors face a protracted period, while their money takes a long holiday as it’s trapped at higher prices. However, as ongoing growth of electric vehicles is being virtually legislated, the company shall doubtless get another day in the sun in the years ahead, when full production commences at future sites* to satisfy the demand from an increasing market.
Unfortunately, for now, we’re still concerned about the immediate price potentials. The share has now closed below the levels of two prior closing price lows, creating a dangerous situation. Presently trading at around 17.6p, the share need only weaken below 16.25p to bring weakness to an initial 14.5p. If such a level breaks, we’d anticipate the price to bottom at 10p, plus or minus a penny or so. This is thanks to the circled manipulation gap on the chart. We now cannot calculate anything below 10p.
To provide an alternate scenario, the share needs to exceed the immediate Blue downtrend. This demands the price better 23p to trigger surprise recovery to 27p with secondary, if exceeded, now at 30p.
Visually, there’s an extremely strong argument suggesting a glass ceiling awaits at the 30p level. But should the share manage to actually close a session sometime in the future above 30p, we’re able to provide the potential of a massive jump to an eventual 46p.
The bad news; we fear it intends to hit the 10p level eventually.
*Article amended on 20 August 2021. Reference to “it being another few years before extraction begins” is removed. Original reference was to future sites, not existing ones.
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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