Quote Originally Posted by Phaedrus View Post
You certainly are consistent in your dogged refusal to recognise the importance of keeping on the right side of market trends, Snoopy. "Selling into market strength" is just as foolish as the "buying into market weakness"
It all depends on the liquidity Phaedrus. Selling out at any price would be foolish if there were no buyers. This is the dilemma of thinly traded small cap shares. In theory buying small cap shares will allow you to outperform the index. In practice if you try to sell those shares at the 'market' price generally you can't. That's because your potential share sale will distort whatever market was there before. I well recall your 2005 sell off of SCT, even though I was out of the country at the time. IIRC you had trouble exiting, and gave back many of those theoretical profits to the market yourself! Far from just reacting to the market as usual, I think you were the one that started the very downtrend that you have just illustrated.

My solution to this dilemma is to treat my small caps as 'value investments' which can be traded against market sentiment. When everyone else wants to selll I will be in there buying, like I did in 2009 down as low as 70c. When everyone thinks SCT is a sure thing then I will sell, creating the market those buyers desperately want. Long term I am not worried as I think SCT will be worth $1.80 within the next couple of years. But I can't be 100% sure of that, which is why I took the prudent option of selling down at about your $1.42 resistance level. It might take some more good news to push SCT beyond $1.40, and that may be 4 months away.

SNOOPY