Industry: Oil & Gas E&P
Sentiment: ⬆️ Speculative Buy at the SMA level. (see the charts for it)
Elixir Energy is an exploration and development company. It is focused on exploring coal bed methane in Mongolia. The company reports in two segments based on its geographical location: Oil and Gas exploration in Mongolia and the United States of America. The company’s exploration project include the solely focused on the 100% owned Mongolia Nomgon IX Methane (CBM*) Production Sharing Contract CSG PSC.
Company reported $9.4M cash in December, with can burn really, so a possible CR (capital raising) could occour in the upcoming months.
With the company’s work program steadily increasing, it is important to know the Timetable for 2021, as SP sensitive announcements could occurs in each quarter accordingly as the company releases results to the market.
The company, claims that Mongolian CSG expected to be highly cost competitive compared to alternative sources of gas for China which is the big consumer that Elixir is focused on getting the investors attention to.
The share price should move further if the company continue to deliver successful exploration results, which according to the latest March 2021 investor presentation, the company is very confident of. (see page 9 of Investor presentation).
From the Technical perspective SP is very bullish since December last 2020 in the last bullish intersection, currently up by 169%. (see chart below)
✅ SP is trading above EMA, as long as this pattern continues, then a long position can be maintained.
✅ Heiken Ashi shows that SP is very weak to the downside, which continues to confirm a potential further upside on the stock.
✅ EMA (exponential moving average – yellow line) is currently trading above SMA, confirming the strong bullish moviment.
🚩 EMA is currently sitting 34% above SMA, representing a very high risk for anyone that is attempting to enter now. According to our strategy we would like to be buying the stock, only when SP reaches the SMA levels or under. (you can see in the chart below an example of the best buying opportunity for future entry).
Overall, the company has a promising growth prospect, as long as the results of exploration are positive. If we were holding this stock we would be keeping our position as long as SP is trading above EMA, and sell if a bearish intersection level 2 happens. If we were buying this stock we would wait for SP to reach the closest to SMA possible in order to attempt an safe entry. Buying now could be a FOMO and we like to avoid it.
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