European Telecom (ETE)

[traderx]

This share has been severely marked down following announcement on 6th December that the AIM float of Global Telematics was postponed due to adverse market conditions. ETE is a major shareholder in this company. The problem, as I understand it, is that the announcement was left until the very last minute after prospectus issued etc. Market did not like it at all. 20 day MA is £2.15 against current mid price of £1.15. Lost 16.5p on friday. Also due on 14/12: 6 months results to 30th Sept. There could be a nasty surprise in the results, which may account for the instutional selling. I personally think this share is now oversold and is due to bounce. Look at the slope of decline, often means the recovery will be just as dramatic when it comes. Some people forecasting 75p bottom. I doubt it, RSI now 11.31 suggesting a bounce is imminent. I think it is worth watching next week. Could be an opportunity to pay for Xmas presents?

no financial advice intended

Tx

 

[Riz]

Hi Tx,

Postponing the planned IPO for Global Telematics had a great negative effect. Although they still have a big mobile phone wholesale operation, e-vita swipe card rights, mint smart cards and one day Global Telematics...

You're right..ETE does look oversold,
but canceling in the morning of the float raises concerns that we might also hear more bad news for their interims on the 14th. But if we hear any good news at all, then a nice bounce and Xmas presents will be safe including the goose...

the Prudential had a purchase of 1.8 mil. last week...something to keep in mind..

Price crossed the lower BB last week and as you said RSI is at the lowest ever point suggesting a bounce might be imminent..

Overall I agree with you that it's worth watching..only very carefully..any unexpected bad news included in the results announcement might just cause ETE to carry on as a penny share..alternatively in case of results not being worse than expectations a strong bounce is imminent...

 

[traderx]

Absolutely correct Riz, you mind of information, I concur

Tx

 

[waldorf]

Agree ETE is trading well below all MA, and may well bounce, but its been in a downward trend for a long time. the sudden drop is probably an over-reaction but IMHO i don't see any TA indicators that say buy me.One of those situations, where good news, bad news makes the price..


------------------

Col

[Edited by waldorf on 31-01-2001 at 02:58 PM]

 

[traderx]

Results as expected, £1.38m loss this time versus £1.45m last time. Down 29.5p at 13.00 hours. Investors must be fearing dillution. Watch it even closer, might get them for nothing when the bounce comes. Theres not much left in the price so bounce could happen soon.

ps worse than Atlantic, safer watching from side lines.

Tx

 

[Riz]

Just had a look at the charts..most interesting...6-month timeframe..right after the price stopped falling sharply and started going sideways around 80 and below the lower BB for the last 4 days..one would expect the price bouncing up to cross above the lower BB..as normally they don't stay below it for long..this time the lower BB caught up with the price and crossed below the price line..

Both stochastic K and D lines are moving flat at he bottom (0)...14 day RSI does the same...on balance volume still heading down also just about to touch the bottom...

Price is moving sideways at 3 years low with almost no volume..it look like either a colapse or a bounce is imminent...

I read somewhere that the NAV is around £1..can anyone elaborate?

So what indicator can detect a bounce (if any) earlier in this case? I'd say OBV in this case...let's test it and see if it can indicate that the smart money is buying...

 

[Riz]

Up +2 to 74..first in a long time..take a look at the volume which has been 10k-15k for a while suddenly increasing to 502,361 most of it being buys..Something must be boiling up..
ETE has a range of options floating GT, selling GT , selling the whole buissness, etc.. any of this options could see the price fly..

Stochastic K just crossed over D both heading up..OBV also is heading up for the first time in a long time..wonder if it's smart money piling in..

worth watching I'd say..

rizgar

 

[Riz]

both price and volume still ticking up..

Up +1.5(2%) to 75.5 ....97.20% buys against 1.30% sells according to sharepages...

rizgar

 

[Riz]

Does this have only one way to move?

Todays Telegraph writes about a possible acquisition of ETE by Just2Clicks:

"KARL WATKIN, the chief executive of Just2Clicks, is understood to have held informal takeover talks with EuroTelecom, the troubled telecoms firm.
Earlier this month EuroTelecom warned shareholders that it had "working capital difficulties". Just2Clicks, which has put its core internet exchange business up for sale, is sitting on a cash pile of nearly £40m. However, it is unclear whether the talks are continuing, owing to conflicting reports coming from advisers close to the companies. Even if a deal is thrashed out, it is likely to face tough scrutiny from both sets of shareholders...."

rizgar

 

[martymcc]

Thought I'd bring these back to everyone's attention. Massive 70% rise on Friday followed by an 8% rise today(was up about 40% intraday). I can't find any reason for this sudden rise. Is it time to get interested or is this one best left alone. My feeling is the latter (for the time being anyway) but am interested in TA and other views regarding reasons for the rise. Cheers

Marty