I am very interested in your technical & fundamental analysis of Poet Technologies (PTK).
Thanks for the assignment. This will be the second time that I hunt the charts for patterns that indicate the potential for POET Technologies Inc. (PTK TSXV). I last examined the case on February 3, 2014 on a request from Tim. The shares were trading for $0.75 and he wanted to know if it was about to breakout. The analysis conducted at the time identified that the shares were enjoying an advance that started in November of 2013 and that over the course of the move higher the shares had broken above the 50-200 day moving averages with conviction. It was also noted that a golden cross had formed in December with the shares hitting a 52-week high of $0.85 by January of 2014.
The stock was pulling back from $0.85 and it was advised to see if support held at $0.70 before committing capital. The shares did retreat to $0.66 before starting another leg up. Another session with the charts will better inform my thoughts on PTK.
The three-year chart tells the tale of a stock that has set fire to the imagination of investors looking for the new new thing. The move to the 52-week high of $2.87 in April of 2014 has certainly created a lot of wealth in a short period of time. Once again the shares are pulling back from the high as they got overbought and the MACD and the RSI generated sell signals.
The six-month chart highlights the signals generated by the MACD and the RSI. There was a buy indicated at the beginning of April when the shares were trading at $1.40. After a healthy gain in a few short weeks the top was first noted by the dragonfly doji candlestick at the top and then by the momentum indicators as they turned lower.
PTK has retested support at $1.40 and caught a bounce above the 50-day moving average. What we can see is that the uptrend line has been broken and that we can expect resistance at $1.80 and $2.00 as the stock attempts to start another leg up.
PTK is a small cap stock boasting a disruptive technology in the design of computer chips which to my mind is a speculative investment. Clearly the speculation has been profitable this year.
Make it a profitable day and happy capitalism!