Ncondezi Energy: Bullish wedge turnaround

1 mins. to read
Ncondezi Energy: Bullish wedge turnaround

It has been a rather rough ride to say the least for shareholders of Ncondezi Energy (LON:NCCL). The question now is whether or not recovery is finally in the air.

In terms of how nasty a small cap situation can be, there have been a few in the recent past where the share price has first flattered to deceive, and then pulled the rug from under the bulls. Ncondezi is one of those examples.

There was a break above the 200 day moving average at the beginning of January, then at just above 5p. However, everything was upset by the as yet unfilled gap to the upside back down through the 200 day line at the end of March.

The newsflow nadir arrived at the end of last month with the company revealing that it had suspended discussions with Shanghai Electric Power regarding its Joint Development Agreement. The position now is that Ncondezi is on the lookout for other strategic partners, and it seems that some in the market are speculating positively in share price terms on what this could consist of.

The hope now from a technical perspective is that we shall be treated to a continuation of the triple bounce off the floor of a bullish falling wedge pattern which can be drawn in from as long ago as April. The initial target here over the next 1-2 months while support at just under 2p remains in place is 5p plus at the top of the wedge – level with the 200 day moving average now at 5.3p.

NCCL chart

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