To OTC Journal Members: 
 

There's some new commentary in the BLOG regarding Ufood (OTC BB: UFFC), which has nearly tripled since my first publication on Friday, and FAS, the triple leveraged long ETF on the financial sector. The last BLOG is already dated. I'll update the entry level for FAS relative to yesterday's break away run in the markets. 

One quick comment on the markets in general. Yesterday's massive responsive to the government's latest plan to buy distressed mortgage portfolios from the banks could have represented a major turning point in market psychology. We may have just made the move to an environment where pullbacks become a buying opportunity, rather than surges being a selling opportunity. I suspect we might see a week or two of lighter, sideways action. Don't forget- next month we have to wrestle with earnings and tax time, so there might be some opportunities on pullbacks.

The BLOG is your opportunity to ask questions and offer comments. I will make an effort to answer every legitimate question. If I don't know the answer, I will contact the management and get the answer. Alternatively, if you have questions you don't want publicly displayed, you can always email me directly at editor@otcjournal.com. If you submit a comment or question, it will not appear on the site until I have responded.

To use the BLOG, simply go to the home page at www.otcjournal.com - the BLOG scrolls down from the upper right hand corner. The most current journal entries appear on the right hand side of you screen. Check back frequently for updates particularly when stocks are moving to overbought or oversold levels in volatile markets.
 

UFood (OTC BB: UFFC)- Use Some Prudence

If you feel like you missed the boat on my latest idea: UFood Grill (UFFC), be patient. The stock has made nearly a triple since I published on it Friday morning at $.12, and it has even taken me by surprise.

As you can see from this chart, there are now three strong up bars with great volume. From a starting point of around $.12, we've now seen a high print of $.35- a hands down triple.

A little prudence on the buy side would be the order of the day at this point. As of this morning, here's the chart. These are the FIB retracement levels. A pullback to $.25 would be a buy recommendation, and a pullback to about $.20 would be a strong buy recommendation. 

At this point, since we've enjoyed a triple off the bottom, it would be more prudent to take some money off the table if anything. That having been said, the wild card is news. If the right news comes along, the stock could be propelled higher. There's risk being out as well as in. Stand by for updates.
 
 

China Back in the Interntional Cross Hairs of Investors

Of great interest to me is the recent renewed interest and enthusiasm for China equities. I am a huge believe China's economy will recover far faster than the US, and therein lies the opportunity. It's all about fuel for the fire. After all, this morning Deutche Bank analyst Alan Hellawell says buy Baidu (NASDAQ: BIDU), the Chinese version of Google. He sees a possible double from current levels, and the stock is up 7% today.

In the good old USA we are printing money as fast as we can to shore up our failing financial system. The consumer is petrified as the headlines are filled with horror stories of unemployment, and cash is being hoarded. The consumer- 70% of US GDP and the fuel of the fire for growth, is barely an ember at this point in time.

Like a Southern California hillside in the Fall, the Chinese economy is full of dehydrated brush, just waiting for a spark and some high winds to get the flames roaring.

The spark is coming in the form at their $600 billion stimulus package, and they can write the check without borrowing. The Chinese citizens are sitting on trillions in savings (more fuel), and the government is doing all it can to encourage spending within the country on goods and services (the high wind). 

The Chinese government recognizes the importance of becoming less dependent on manufacturing exports, and is moving rapidly to help their economy become more self sustaining. 1.3 billion citizens represent massive fuel for the fire.

FXI is the ETF representing 20 of the largest companies in China. This ETF, which offers a 3.1% dividend at the current price of $29, is a great way to participate in China's future economic growth. So far this year it has tended to go up with the US market, but wasn't down nearly as badly during the huge Feb to early March swoon. At one point it was one of the few large cap securities in the green in the markets- all others were hemoraging at lower levels.

I have a buy recommendation on this security at $28, and a strong buy at $25. I believe this security will far outperform the S&P 500 for the remainder of 2009, and is a great investment for the more conservative growth end of your portfolio.

On the smaller stock side, I believe CGYV a strong buy today. This stock also weathered the huge downturn in February admirably, and is technically poised for another leg up.

Here's some international commentary of what's coming in terms of stimulus expansion in the Chinese economy:

• China continues steadfastly to promote energy conservation, emissions reduction and ecological and environmental protection. Figures from the government's 2009 Work Report indicated that China allocated 42.3 billion yuan (about $6.3 billion) to support development of 10 key energy conservation projects and environmental protection facilities in 2008. Choy So Yuk
• The five-year plan calls for cutting energy consumption 20 percent per unit of GDP by 2010 while reducing sulfur dioxide and other air pollutants 10 percent. For China to hit the targets, provinces must reduce their collective energy consumption about 4 percent per GDP unit annually, compared to 2005. Greenwire, March 12th.
• DAR ES SALAAM (Reuters) - China can lead the world out of the economic crisis thanks to its healthy foreign exchange reserves, robust trade surplus and massive investments round the globe, an adviser to the U.N. secretary general said.
• The city of Wenzhou in eastern China, an export-oriented manufacturing mecca, is seeing an economic recovery thanks to Beijing's stimulus measures and the capacity of privately owned local firms to address challenges. Reuter's, March 7th
• In 2009, about 124 billion yuan ($18 billion) will be set aside for environmental protection, an increase of 19.6 billion yuan ($2.9 billion) or almost 20 percent. 49.5 billion yuan ($7.3 billion) for energy conservation and emissions reduction - an increase of 17 percent - will be spent on retrofitting energy-conserving technology, decommissioning outdated production facilities, and increasing the application of efficient, energy-conserving products and alternative-fuel powered vehicles. Choy So Yuk- government official

There's a new research report available on CGYV, and yes- you have the first look compliments of the OTC Journal. Harbinger Research rates the company a "Strong Speculative Buy", and provides projections for corporate performance I believe are rather conservative.

Analyst Brian Connell forecasts $22.9 million in 2008 with $1.6 million in operating earnings- $38.5 million in '09 with $3.4 million in operating earnings, and 61.6 million in '10 with $5 million in operating earnings.

I believe CGYV can achieve north of $40 million this year, and something closer to $100 million than $61.6 million in 2010. After all, there's a huge problem with China's carbon footprint, and CGYV is in the middle of energy conservation and energy efficiency firestorm over in China. 

There is also a massive amount of capital coming down the pike to help stimulate economic growth and clean up the atomspheric Armageddon that is China today. 

It is estimated China wastes about 4 times as much energy per capita as most industrialized nations. China Energy Recovery (OTC BB: CGYV)- doubling in size year after year, profitable, and loaded with cash to fund operations is all set to profit from this revolution.

Here's what you should do today. Review the video I put together on the company last summer. The energy cost side is now outdated thanks to the drop in oil, but the remainder is still current. Just go to the video player at the home page of OTC Journal- www.otcjournal.com, and click on the China Energy Recovery link.  Take 12 minutes.

Read the Brian Connell's research report. You will have the first look. The rest of the investing world is not aware of this document. I have it in PDF form on the OTC Journal for you to read. Simply Click Here, and the report will magically blow open on your computer screen. 

As you can see from the chart, CGYV has been a lot like the large cap China sector. It did not participate in the monster sell off in February and early March, and should start to rally now that the world is focusing on China again.

CGYV has been in a "low volume basing" pattern for about a month now. It has formed a cup on lower volume, and is now extending out sideways.

Potential catalytic events to get the stock moving would include year end and Q1 numbers. Year end should be available by the end of March, with Q1 to follow in six weeks.

New contracts and expansion are also on the horizon. I'd like to see you accumulate this one while it's quiet. You need to have faith their substantial growth rate and profitability will bring investors to the table very soon, and we could see the kind of meteoric run we've witnessed in UFFC of late.

Accumulate this one now for the next leg up. China situations are finally coming back.

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