Dalradian Resources (DNA.TO/DRLDF) is a stock that had been previously recommended by Mark at IKN, but which fell out of favor after a bad financing deal last year. I believe Mark recommended profit taking and moved on. This is actually irksome to me as well and so I do not have the warm and fuzzies here. Just trying to find laggards with good upside potential for patient holders.
I leave it to anyone interested to dig up the old news, but according to a fundamental source I trust (long-term subscribers may remember very early NFTRH subscriber ‘FL’, who has also been instrumental in apprising me of Klondex’s solid funda along the way), the major ill effects of the deal should be about worked through. The company owns a high grade gold property in Northern Ireland. See more at http://www.dalradian.com/.
We need not look further than the disaster that befell Sabina Gold & Silver in order to realize the risks inherent in exploration/developer companies. But with the risk comes the potential reward.
But NFTRH+ is a chart spotlighter and I took a look at the chart and liked it. The daily chart has been consolidating an upward burst in April with a big, downward biased flag. It tried to break the flag a couple of times but so far, no dice. The price also remains below the SMA 50, which is starting to point down.
The weekly shows a decline to a support area. It could be a flag about to find support or it could make its way to the bottom channel line way down around .70. I am going to buy some shares in support of the former. The reason being I am taking profits on the larger names like SLW and GG and looking for smaller and/or lagging situations now that a bull is confirming in the sector yet the shorter-term risk vs. reward is not favorable.
Along these lines I added to KLDX when it pulled back today and am trying to balance profit taking in the sector with longer-term positions. Dalradian, bogged down for so long due to the financing deal, seems like a good relative risk vs. reward in the sector. Again, I am depending on someone else’s fundamental view, but I do find the chart interesting.
Buy Target: .95 (I bought for portfolio reasons, not trading reasons) or .75 in an unlikely event of a wipe out. Alternatively, one might wait to see if it breaks out of the consolidation and buy the upside. 1.10 to 1.15 would be the breakout area.
Sell Target: New highs above 1.30 (I may or may not sell, given the sector bull view).
Stop Loss: Below .90 to suit risk tolerance.
A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the buy, sell, stop parameters are already noted. They are meant as a starting point for further research if interested. I will not personally buy every item highlighted and will sometimes sell – without prior notice (because this takes time and resource away from NFTRH’s main functions) – any item that I do buy, below target, which is something I often do as a trader. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.