It really has been a slow burn higher, but Strategic Minerals (LON:SML) is now delivering the lap of honour the bulls were hoping for in share price terms.
Strategic Minerals has been the type of small cap situation that proves how patient the private investor needs to be, but also how well rewarded this patience can be. The latest news from the diversified mineral development company is that there has been record domestic sales of 14,264 tons for the March quarter at its Cobre magnetite tailings operation in New Mexico, USA.
Added joy is provided by the fact that the profit margin for March quarter at Cobre was over 50% of sales. All of this leaves the cash position of the group standing at just under $700,000, and allows us to take an optimistic perspective view on the technical position of the stock, even after all the gains.
What can be seen on the daily chart is the way it is possible to draw a rising trend channel in from as long ago as August last year, with the floor of the channel currently running level with the 20 day moving average at 1.4p.
The assumption to make now is that provided there is no weekly close back below the 20 day line / 2016 uptrend line, we could still be treated to further significant upside. The favoured destination over the next 4-6 weeks is anticipated to be 3p at the 2016 price channel top, especially if initial April resistance at 1.7p is not breached over the next week.