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To
OTC Journal Members:
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Market
Comment- Our 911 Anniversary Ideas |
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A week ago, on the eve
of September
11th, we published an edition suggesting the market
was poised for a Post 911 rally, and provided a couple
of trading ideas we felt could appreciate nicely if
the rally materialized.
Having called the August
rally just after the July lows perfectly, we were hoping
for a couple of short term ideas which could provide
30% plus gains in an improving market climate.
Tuesday was the critical
day for the NASDAQ. It was camped right on its support
line, and had there been a late day rally our ideas
might have worked out. Instead, the market sold off
late in the day as geopolitical fears dominated the
news, particularly the potential US invasion of Iraq.
As depicted by the yellow
line, support was broken to the downside, and we are
no longer hoping for any type of post 911 rally. In
fact, we expect the NASDAQ to now retest the July lows.
A successful retest
of the July low at about 1200 on the NASDAQ could provide
the next opportunity for a trading rally. Many technicians
prefer to see the double bottom before turning bullish.
Therefore, if the NASDAQ does drop to 1200 and stabilizes
for a day or two, a rally could be imminent.
Had you bought FDRY
and MLMN at the open on September 12th, you would
have picked them up at $9 and $11 respectively. If you
had adhered to our Stop Loss advice, you would have
sold them at $8.25 and $10.40, for net losses of 8%
and 6%.
While it's no fun to
lose money, losses of this magnitude are manageable,
particularly on the heels of the two 30% gains we had
in August. As the market allows, we will continue to
publish ideas which could provide short term profits.
However, whether you use our guidelines for a Stop Loss,
or choose your own level, employing a stop loss in this
market environment for your trading money is mandatory
for survival.
We still believe 2003
will be the turn around year for the stock market. We
also continue to believe a new Baby Bull market will
be born sometime in October or November. As we have
commented frequently, this new bull will be extremely
weak, and may take as long as five years to grow strong
legs.
Investors will have
to get used to 5% to 10% annual returns in the overall
market. However, individual companies that grow and
become profitable will still prove to be outstanding
investments.
Our current Bear Market
has now lived an unprecedented life span. Typically,
Bear Markets last 18 months. At the end of 2002 we will
complete three consecutive down years in the major averages.
We felt like the Bear
might be coming to an end last Fall, then we had 911.
We felt like the Bear might be coming to an end early
in 2002, then we had Enronitis which snowballed as widespread
corporate malfeasance dominated the news. Corporate
executives, the new rock stars of the economy, were
treating their financial statements like a rock star
treats a hotel room- abusing investors as it suited
their purpose, feeling their power allowed them to write
their own rules.
One bright news event-
Denis Koslowski, former Chairman of Tyco, was unable
to make bail today as the government has frozen all
his assets. He may be sent to Rikers Island to await
trial.
Now we have the possibility
of war with Iraq, which is also dampening enthusiasm
for the market. If we invade, and the market drops rapidly,
there will be some extraordinary buying opportunities-
keep some cash on the sidelines.
The housing and bond
markets are enjoying the same kind of bubble the NASDAQ
had towards the end. Don't buy bonds today unless you
are prepared to hold them to maturity- you will lose
money next year if you want to sell them in the open
market. Don't over leverage your home- the value may
drop a little over the next several years. Homes in
California lost 30% of their value between 1990 and
1995. People forget.
We intend to continue
covering our favorite micro cap situations and trying
to find trading ideas. The markets will eventually turn
and once again the OTC Journal will become your
favorite item in your inbox.
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Calypte
Biomed (OTC BB: CALY)- Comments on Pathetic Performance |
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Calypte continues
to trade very poorly on very substantial volume. In
fact, most days Calypte has the highest volume
of any stock on the Bulletin Board under $.25.
The chart provides no
relief. With the stock below $.10, all levels of support
have disintegrated, and technically there is no evidence
to suggest the stock is poised to rebound.
Public records reveal
no current financing which would explain the extraordinary
amount of stock for sale. Since early August the company
has issued 5.7 million shares for financing activities.
This amount only represents a couple of days volume.
The only explanation is simple momentum. As the stock
continues dropping buyers at higher levels wonder if
the company is once again on the verge of failure, and
sell to preserve capital.
Despite the stock's
poor performance, the company continues making fundamental
progress. This month's announcement concerning progress
towards penetrating the Chinese market helped the stock
rebound temporarily. News of the first orders out of
Western Africa had the stock trading huge volume in
August.
The holy grail for this
company will be the approval of their urine based AIDS
test kit by the World Health Organization. This will
lead to substantial international sales, and could come
as early as November.
Another potential windfall
would occur if they make substantive progress towards
getting their rapid urine based AIDS test kit into the
International market. This would be used heavily in
the field where the AIDS epidemic runs rampant.
Today, just prior to
the open of the market, Calypte Biomed issued
a press release which we don't view as substantive,
but may help the stock rebound. Investors should view
this stock as an option- it may expire worthless, but
the upside makes it worth taking a shot. This is a go-for-broke
situation. You may lose all your money, but you might
also hit a grand slam.
Here is today's press
release for your review:
NEWS
RELEASE
Calypte
Biomed
FOR IMMEDIATE
RELEASE
CALYPTE’S
URINE HIV-1 ANTIBODY TEST NOW APPROVED FOR LIFE
INSURANCE SCREENING IN ALL 50 STATES
WEST VIRGINIA
DEPARTMENT OF INSURANCE AMENDS RULE O INCLUDE
URINE HIV-1 ANTIBODY TESTING
Alameda,
Calif. – September 19, 2002 – Calypte Biomedical
Corporation (OTCBB: CALY), the developer and marketer
of the only two FDA-approved HIV-1 antibody tests
that can be used on urine samples, announced today
that the West Virginia Office of the Insurance
Commissioner has cleared the way for urine HIV
screening among life insurance applicants in that
state. With this decision, Calypte’s urine HIV-1
screening test is now approved for use by the
life insurance industry in all 50 states.
Until
now, life and health insurance companies writing
policies in West Virginia have been unable to
test specimens other than blood and oral fluid
for HIV. The Interpretive Rule amendment made
by the commissioner is intended to serve as a
bridge to the effective date of the Legislative
Rule, and allows the urine-based screening to
begin immediately. The Legislative
Rule is expected to be effective in the spring
or summer of 2003.
“Life
Insurance companies have been very receptive to
urine-based testing as an effective, convenient
and cost-effective alternative to blood testing,”
said Nancy Katz, President and CEO of Calypte
Biomedical. “We now have the approval of
approximately 150 insurance companies to order
our tests, including nine of the top 10 life insurance
underwriters as ranked by policy value.
The Calypte urine antibody tests are completely
non-invasive, which results in a painless and
comfortable way for insurance applicants to provide
a specimen. Also, urine testing is safe for those
collecting the specimen who otherwise would be
at risk of contracting HIV from accidental needlestick
injuries. We are very pleased that the State
of West Virginia has made progress developing
the necessary procedures that allow our life insurance
customers to expand their utilization of urine
testing.”
“Now
that West Virginia has joined every other state
in approving urine screening tests for HIV-1 antibodies,
we believe that it will be even easier to get
our message out to life insurance and other communities
that our proprietary urine screening test represents
the future direction of HIV-1 screening,” said
Anthony Cataldo, Calypte’s Chairman.
About
Calypte Biomedical:
Calypte
Biomedical Corporation headquartered in Alameda,
California, is a public healthcare company dedicated
to the development and commercialization of urine-based
diagnostic products and services for Human Immunodeficiency
Virus Type 1 (HIV-1), sexually transmitted diseases
and other infectious diseases. Calypte's tests
include the screening EIA and supplemental Western
Blot tests, the only two FDA-approved HIV-1 antibody
tests that can be used on urine samples. When
compared with existing blood-based tests, our
testing algorithms are non-invasive, easier to
use, less expensive and have significantly less
risk than blood-based testing, and they have 99.7%
sensitivity in subjects previously identified
as HIV-1 infected and 100% specificity in subjects
at low risk when combined with the urine-based
Western Blot supplemental test. The company believes
that accurate, non-invasive urine-based testing
methods for HIV and other infectious diseases
may make important contributions to public health
by helping to foster an environment in which testing
may be done safely, economically, and painlessly.
Calypte markets its products in countries worldwide
through international distributors and strategic
partners.
#
# #
Statements
in this press release that are not historical
facts are forward-looking statements within the
meaning of the Securities Act of 1933, as amended.
Those statements include statements regarding
the intent, belief or current expectations of
the Company and its management. Such statements
reflect management's current views, are based
on certain assumptions and involve risks and uncertainties.
Actual results, events, or performance may differ
materially from the above forward-looking statements
due to a number of important factors, and will
be dependent upon a variety of factors, including,
but not limited to, our ability to obtain additional
financing and access funds from our existing financing
arrangements that will allow us to continue our
current and future operations and whether demand
for our product and testing service in domestic
and international markets will continue to expand.
The Company undertakes no obligation to publicly
update these forward-looking statements to reflect
events or circumstances that occur after the date
hereof or to reflect any change in the Company's
expectations with regard to these forward-looking
statements or the occurrence of unanticipated
events. Factors that may impact the Company's
success are more fully disclosed in the Company's
most recent public filings with the U.S. Securities
and Exchange Commission ("SEC"), including its
annual report on Form 10-K for the year ended
December 31, 2001 and its subsequent filings with
the SEC.
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