InterOil shares perform very strongly
It looks like the stock price action is trying to tell us something. We were expecting some kind of profit taking, followed by a consolidation phase, but the stock is way stronger than we expected, going up in a down-market even after it had a very strong rally already.
- A) Panicking shorts
- B) Near inevitability of more substantial good news on the way
- C) Funds praying on the weak position of the shorts (it’s a dog eat dog world out there..)
We think it’s a combination of all three. The shorts wouldn’t be panicking if B wasn’t a real possibility, and we have already seen in the data that C is happening.
Very encouraging. The only thing missing is the volume, but that could actually be a more bullish sign:
- The shorts are no longer in control of the price even on low volume days
- What will happen when the buying volume really kicks in on a substantial announcement…
There still might be some consolidation (the stock is slightly overbought), but we wouldn’t count on it. It really looks like it just wants to get higher..
See chart below: