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Savannah Resources (SAV) maybe returning to 7p ?

SAV Savannah Rresources Technical Analysis 031114
Savannah Resources PLC (LON:SAV) served up a lightning rally from this time last year to the beginning of March, with the sweep to the upside delivering a move from below 3p to just below 14p. While we might have been expecting a degree of winding down / retracement after such a large ascent, the decline to back below the 4p level by May might have taken some traders by surprise. Perhaps the best aspect of the price action since then has been the way that despite several false dawn attempt at delivering a sustained recovery, we have seen the area just under 4p remain in place as support. The key now is therefore how much more consolidation is required by the shares ahead of a lasting turnaround and what kind of technical signal may be strong enough to deliver such a manoeuvre? The best that can be said at this point is that while cautious traders might wish to wait on an end of day close back above the 50 day moving average at 4.88p it could very well be the case that at least while above the October intraday support at 3.75p we do have a decent risk / reward situation in place. The expectation is that as long as the October floor is held there will be a “minimum” return to the September 7p zone resistance as soon as the end of November.

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