Is something important happening with this energy stock?
The share has been floundering, but financial gymnastics could be coming.
26th May 2021 08:47
by Alistair Strang from Trends and Targets
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The share has been floundering, but financial gymnastics could be coming.
Hurricane Energy Plc
For some time, the share price of oil exploration stock Hurricane Energy (LSE:HUR) has been trading at levels where we cannot calculate its lowest ebb. Once the price opted to drill below 11p in March 2020 we floundered, thanks to a lack of ‘ultimate bottom’ target levels.
However, in the last week, the share price has managed to enact some interesting movements, making us wonder if something important is about to happen. To be honest, we shall not be surprised if the ploy of a 'share split' is enacted, perhaps a 50:1 sleight of hand to pretend the share price is back trading at levels last seen in 2018 and 2019.
Alas, the harsh reality with these games is an outcome where share prices again face a few years of being slaughtered by an unsympathetic market, the main losers being private investors.
Obviously, we've absolutely no inside knowledge suggesting this sort of thing is coming, just a painfully familiar feeling. When a share remains trading despite the price being arithmetically miles below our ultimate bottom of 11p, we tend suspect some financial gymnastics are coming. Less likely (but it happens) is a flow of good news, capable of changing company fortunes.
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However, if we chose to search for reasonable trigger levels, it appears Hurricane Energy needs to trade above just 1.75p to give early warning for some reasonable movement.
According to our software, movement above 1.75p should lead to a completely boring 2.25p. Only if the share price discovers a reason to explore above 2.25p do things become really interesting, as recovery to an initial 3.5p calculates as possible.
If 3.5p is exceeded, our secondary works out at 4.4p and visually, it even makes some sense. In a conventional world, should such a level make an appearance, we shall need to examine price movements and run the numbers again, thanks to some pretty illogical recovery levels making themselves known.
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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