Noble: one man's meat is another man's poison

I declared a solid bonus, $10.66k, for myself today (18 May 2017) with my winning wager on Noble Group when I got to know from newspapers and from InvestingNote that almost all analysts and punters thought that Noble would not be a going concern soon. The company directors also declared that it would take a long time for the company to be in the black again.


My instinct was I might have a chance to make my quick bucks. I started monitoring the share prices and was waiting for it to keep plunging till it reached the maximum pessimism, i.e. near the closing bell on 15 May 2017 (Monday), which I decisively bought 170,000 shares at 59 cents apiece, amounting to a total of $100,557.6.

The target prices that I set and my reasons for the entry then:

2 weeks target price = S$0.75 (Dead cat bounce)
3 months target price = S$1.14 (When dust settles) 

1. Noble should have an immediate dead cat bounce as the plunge is over-corrected. 

2. Short –squeezing will take place as shortists will all run at the bottom almost simultaneously. 

3. The bosses will go in also at this time to give support to the share prices. Who knows some of the insiders also went short as they would have known the bad results and now they are closing the loop to make some money. 

4. The fundamentals of commodities all over the world are actually quite sound and Noble has become too much undervalued after this triple whammy (bad quarterly results + 10-into-1 consolidation + Icerberg Research's condemnation.)

I made use of my chart-reading skills to time the entry. I had learnt this through experiences, reading of many books, and attending courses. The action to enter Noble at 59 cents, to me, is a moment of truth that my years of preparation was put into good use and I was very excited about it. Yes, I was greedy when others were fearful. Yes, I am a shark and when I smell blood, I will go for the kill!

I shared my thought in InvestingNote after my purchase in the same evening. I do not think that I alone can decide the movements of the prices of the stock that I recommend, especially volatile stocks like Noble. That said, I hope I have had the wisdom to help InvestingNote viewers and my followers at the first opportunity to quickly uncover the gems or take advantage of extreme anomalies to accumulate wealth. I am sure anomalies will be reduced to parity sooner if more people get to know about them fast enough.

Noble daily chart at market close on 15 May 2017

I was proven spot-on and Nobel’s price took a reversal on 16 May and carried on its uptrend on 17 May, and the most part of 18 May till around 3+pm that it started to move down quite rapidly. The highest price done on 18 May was 74 cents.

I sold half of my position on 16 May at 63 cents apiece, and the other half on 18 May at an average price of 68.25 cents, all within the contra period and a handsome return of 10.6%! 

Noble intraday chart on 18 May showing the downtrend towards the close of market

Some people may say the plunge at the later part of 18 May was due to Trump's impeachment issue or Europe's bearish opening. But I believe that technically, as chart usually does not lie, when it is time to run, we will have to run much faster than those uninitiated. I think I have achieved just that. 

Kudos to my own hard work, good judgement call and a mission well accomplished. Congratulations to all those who followed me in this journey and I noticed some of them even made more percentage of return vis-à-vis mine.

Superphang
http://superphang.blogspot.sg