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We did say it won’t hold for long

Posted: 11/26/2012 - 11:11 am

On November 18, we made the case for a top in Saudi Fertilizers (Safco 2020) and we advised traders not to wait for the confirmation and take a pre-emptive call by selling the stock (read: Keep it a winner).

As expected, a top was formed and the stock sold off from 197.5 to 191.5 for a loss of 3%.

As highlighted on the chart, the latest pull-back puts the share price at an important support around 190 and while a short-term buy would typically be valid at that level, we stick to our conservative trading approach highlighted in our latest note on Saudi (read: Saudi: did you follow the signs?) and recommend staying on the sidelines at this point.

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