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Coming Attractions:
Looking For High Profile Ideas |
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We've had some fun selling taking
profits on big, streaky runs this year, and it's a theme I plan to embrace
for the foreseeable future. Recall I recommended selling TLPE when
it streaked up to $.41 in early January as the shorts were squeezed.
HDY
has streaked a couple of times, and profits were available.
KAL
appears to want to take a breather- but profits were available in that
situation as it traded from $1.03 in November to the $1.70
mark in January.
I am trying to find ideas that have
the potential to become front page news, which can equate to big moves.
Recent idea Advanced Cellular (OTC BB: ACTC) fits the bill. The
company was featured in a front page NY Times article last Fall, and boom:
big streaky run from $2 to $3 in one day.
And then there's Cramer who
has been very good to OTC Journal subscribers not once, but twice.
If you were around last summer when Cramer recommended GEPT at
about $3.25, you should also remember us taking profits at $7
to $8 a couple of days later.
And how about DXCM two weeks
ago Monday. Personally, my most profitable trade in a long time. Cramer
recommended DXCM two Friday's ago at $20. OTC Journal subscribers
had the idea at the end of January at $16. The next Monday we had a double
whammy: Cramer's move and the FDA Approval all in the same day. Thank you
God. I sold my entire position at about $23 for a whopping short
term profit. I hope you did as well.
So, now we've got ACTC with
the founder of Geron Corp (NASDAQ: GERN) running the company and
NY Times ink. The stock has been trading quite nicely since first featuring
it.
It happens all the time in the microcap
world. Stocks appear to be dormant and testing your patience. Then boom-
a major event happens out of nowhere and the stock rockets as everyone
piles in. These events are always selling opportunities.
I have two more ideas coming that
could be the subject of major publicity in the future. They both have been
already. I love selling into those big streaky moves. Look for a couple
of new ideas in the next week or two that might float your boat.
Remember- you should view the OTC
Journal as simply a source of ideas. If you like the idea and want
to act on it, go in with a plan. I strongly recommend deciding how much
you want to commit, and taking a partial position to start. Then, if it
goes against you, you can add to the position at lower prices, and reduce
the position on surges. Most importantly- decide your yourself if you like
the idea.
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The
Market Defies Gravity |
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| The objective of the correction
is to divorce investors from their hard-earned gains; corrections create
enough fear to force you out of stocks at the peak of maximum frustration
-- the market bottom. Author: Unknown |
During the month of March the DOW,
S&P 500, NASDAQ Comp, and Russell 2000 all made multi year highs. The
market seems to be defying gravity. Last Fall oil prices and interest rates
drove stock prices down. We have $68 Crude Oil, $588 gold, and a 10-Yr
Yield at 4.84%, all of which project for rising inflation and a Fed that
we believe will be more hawkish than the stock market is currently inclined
believe. By all rights, the market should be tanking.
In fact, flush with cash from my
DXCM
trade, I am holding put options on the NASDAQ proxy stock: QQQQ- This is
a bet the market will go down. Until Friday's reversal, I was losing big
time on the trade. I have since recouped some of my losses, but I'm still
underwater.
Here's a long term look at the price
of Crude Oil. It is holding up beautifully above the blue line: the 3x3
displaced average. If it doesn't break convincingly below that line in
the next several months, look for $90 to $100 crude, and watch the rest
of the market tank.
On the other hand, if Crude rolls
over, that will be a precursor to a potential market surge.
Here's a look at the HUI- the index
which tracks directly to the price of gold. The over all market is saying
inflation is tame through its performance. The price of gold says otherwise.
Someone is wrong.
This long term chart shows a "failed
double repo". In my technical view, Gold is going higher. Ultimately, higher
commodity prices which include gold and oil are good for a few stocks,
but bad for the majority.
The market could keep powering higher.
However, unless the price of oil and gold start to head south, I believe
we could be in for a rough summer.
It is time to examine your holdings
and set your stop losses. If stocks trade against us for an extended period
of time, I want everyone to start thinking this way.
Set your mental stops. If you're
stocks trade down to your stop loss levels, sell them and get out. Ideas
are plentiful. Capital is scarce. Keep our capital largely intact for better
days if you have to.
Click
Here to visit our archive section. You will find my suggested stop
loss levels listed at each company.
FYI: My Canadian friends are all
raving about Golden Peaks Resources Ltd: CDNX Symbol GL.V. I own a few
shares, but know little about the company. If you are looking for a speculative
gold play, have a look at that one.
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