Kibo Energy

April 16, 2024

I will only buy the stock again if...

Nature of penny stocks


Penny-stocks are mostly illiquid instruments , high-risk and extremely speculative. Often times these stocks cannot be easily and readily bought or sold due to their liquidity or high spread. Most Investors tend to focus more on the potential rewards they  offer and forget the adverse risk they come with. Penny-stocks can move from zero to hundred in one trading session and back to zero on the next. In my humble opinion, penny-stocks are not suitable for passive investors or newbies.  

Price and Valuation play an important in my approach to penny-stocks. A stock can be a penny-stock and still be expensive. It is a huge misconception to assume that all penny-stocks are cheap  or undervalued. Technical Analysis is one model/approach I use to analyse the value of penny-stock. Contrary to popular belief, technical analysis can be extremely beneficial when done right. All my entry points and exit points are solely based on Technical Analysis. Watch this video here for reference  https://youtu.be/q0Aao4tNEhA

Often times, market will react before you get hold of a SENS announcement. Technical Analysis can help you stay ahead of the game. Majority bought on news and I simultaneously sold on hype of the very same news.  I deem Kibo Energy expensive at its current price.


Technical Analysis on Kibo Energy


Resistance refers to an area of sensitivity from which price tends to reject to the downside of the market.

Support refers to an area to which price finds grounding or base.


The chart on the far left hand side shows two levels, support and resistance. I mentioned last week that I took profits on the stock because it was trading close to a resistance area. The area has proven to be a strong resistance, as price rejected quite aggressively on Friday the 26th and will continue to be a major resistance for the stock. The lower area on the stock is my support zone and my area of interest. Based on my approach, I will only buy when or if price reaches this level again. The level ranges between 5c and 6c per share. 

The chart in the middle shows a market gap at 6c which correlates to the aforementioned support zone. Based on the nature of Kibo Energy, market gaps always get filled. This give me confidence that the stock will go back to 6c or 5c and the forecast is also solidified by the double-top formation showed on the first chart. 

I am not buying the stock unless all the conditions mentioned above have been met.



Disclaimer: None of the information shared above constitute financial advise. The information shared is just a true reflection of the author's opinion and experience. Seek financial advice from a registered financial advisor.







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