Yesterday I took short term trading profits on Marengo Mining (MGO.ASX). I traded into Global Mining (GBE.ASX), which is currently striking low-term or all-time lows, and thus made a compelling entry. Looking at the chart for Marengo Mining, this stock appears to be going back to 9-10c support. This will probably happen in association with an issue; but I can't recall their cash position. The long term chart offers no short term clues of course; but it does show that we are looking at a lot of lateral consolidation before this stock breaks out. This is of course consistent with the VERY long development lead time. Let's not forget that this project is in PNG, and that exploration costs are high. I recall City Resources in the 1980s being absorbed by other interests because of the huge cash drain of its PNG interests.
This company it at least more focused. The problem is that it found the most lucrative exploration area - highest grades after outlining the main ore zone. A great stock to trade though off that 9-10c support....though those trades will get commensurately smaller as that 'wedge' close out.
Note the stock is struggling to achieve pass its moving average; and 15c is an important resistance.
Not a bad return for a fortnight stake - 12.5c to 14c. What's that 20%?
This is also an industrial stock and we are in a recession. Copper is an appealing commodity however.
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