MagIndustries Corp MAAFF

RE: Averaging down

[canadianpilgrim]

"I will be averaging down at some point.

  Any predictions regarding share price over the next week or so? Should hold 50 cents when looking at the charts.

  Any ideas out there?  Much appreciated. "

Listen I love this stock. It's made me a pile of money this year. BUT I must be looking at different charts. Technically MAG looks like crap, especially if we just entered a market correction today. All 3 US indices crashed through 50dma. Candles look sick. Institutional investors have been buying levaraged Bear funds like no tomorrow. Out of the money S&P puts up 400% today. MAG itself, has punched through its 50 dma. Sure there are support levels here at 53, 50, 47.5, but I think they're all too weak to hold. It looks like we're moving back to the 200 dma at 43.5 cents or the 50 wma of 41....which takes us right back where we were before this deal with the ChiCo was announced. Since this deal, now has an element of doubt, I think we could drift lower to that point over the next 7-10 trading sessions. It sucks, but I'm glad I sold out.

I think 53 cents is the stronger support level. I can't prove it categorically, but there is some large player out there that has consistently been buying board lots of MAG when it's 53-56 cents for the last couple of months. If 53 cents doesn't hold, then that means these guys have either gone home, have adjusted their buying range or there are just too many sellers. Unless we experience a market panic, I would expect this level to hold for a few sessions at least as long as those guys keep buying. If they decide, they can accumulate this stock for cheaper, watch out.

Frankly, I'm going to put in some stink bids. Just in case, we get a buyer's strike, I will pick up stock on the cheap.