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OTC Journal Members:
Lots of Blogging for your
entertainment and education on the RIMM trade I am in fairly heavily
this week. So far, I'm not doing too well. While I still believe the trade
will make money to some extent, my timing on really loading up on those
put options was not great. I should have waited for the stock to make its
high on Thursday- the first full trading day after the numbers came out.
The stock dropped fairly nicely in the last hour of trading on Friday,
but I really need it below $117 before I really start to make any money,
and time is running short. However, if history repeats itself post earnings,
the stock should correct next week. If it doesn't start coming down in
earnest, I will either have to close out the position at a loss, or perhaps
roll the options out until May.
The action in the markets was very
encouraging this past week. We had a huge up day on Tuesday, and the market
held its gains through the week against a backdrop of very rough numbers
on the economy. Hallelujah- I'm seeing some signs of microcaps starting
to show signs of life. There are two examples for you to look at in the
weekend edition.
Here's the most important message
I can share- there is easy money to be made in some of these microcap situations
when buy side volume comes back in. Some of these stocks are so blown out
there is really none left for sale. Those who wanted to or needed to have
sold, and when volume materializes they will trade up as if in a vacuum.
That will be the easy money, and it will happen fast. From there, the market
and the companies will have to behave to make any further progress. One
by one, with the good companies, it will happen.
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.
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Two Micros Starting
To Put On a Good Show: PNWIF First |
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PhotoChannel (OTC BB: PNWIF)
is the first on today's list which is worth a look right now. The stock
is making a valiant effort to trade up to and hold the $4 level, which
is critical to the future of the stock price.
Why is $4 so important? Simple-
it's the threshold for a NASDAQ Small Cap listing, and the only one of
the criteria they are missing. It is widely known PNWIF has applied
for a NASDAQ Small Cap listing, and many believe a $4 price will see them
graduate.
There are two pending catalytic events
which could push this stock up in the near future. They are close to completing
the installations for both Sam's Club and Costco USA. Once implemented,
Sam's Club and Costco should push revenues up very substantially.
For those who need a reminder, PNWIF
provides the back end interface for the photofinishing web sites for many
retailers. Here's how it works. You go to Costco's web site. You log in
and upload your digital photos. The web site says Costco, but PNWIF maintains
it and processes all the transactions. After you have uploaded your photos,
you order prints, and go into the store one hour later to pick them up.
It is known as "Online to Retail". PNWIF gets a few cents for every
print, but doesn't have to provide photo processing equipment or the customer.
It's a great model with a strong recurring revenue stream.
One of my intrepid readers informed
me that the Sam's Club services have been implemented. I went to
the Sam's Club site, and couldn't find any evidence that PNWIF has
officially launched it under their control. If they had, it would say "Powered
By PNI" at the bottom of the web pages somewhere. However, I wasn't able
to get into the downloading and ordering section, as I am not a Sam's Club
member.
Even if Sam's Club hasn't flipped
to PNWIF yet, both Costco and Sams's Club are expected to flip over
in the very near future. As you can see from the chart, the stock is starting
to perk up very nicely.
The news that either one or both
have commenced commercial activity should send this stock up over the $4
threshold long enough to get NASDAQ SC approval, which should in turn add
another point or two to the stock price. It will open the stock up to a
much wide institutional base of investors.
2007 was a year when tiny PhotoChannel
garnered a lot of attention as it pirated business away from behemoth Hewlett
Packard (NYSE: HP). With the market showing signs of improvement, this
stock could be ready to start the next leg of its journey north and on
to a bigger and better exchange.
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QPC Lasers (OTC BB: QPCI): A Volume
and Price Breakout |
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I don't know a lot about QPCI,
but I sure like the price and volume surge I am seeing in the stock. This
company was brought to my attention by a fund manager who has the midas
touch, and I love what I see technically.
I first looked at this Friday morning,
and I immediately picked up 20,000 shares for my personal account at $.79-
the stock closed Friday at $.81 x $.83.
A quick review of the company's business
reveals they are pioneers in laser technology- both for the military and
medical. Total revenue for 2007 was only $2.8 million, but that was a 158%
increase of 2006. More importantly, QPCI disclosed it has one $12
million order which could develop into nearly $300 million in revs over
the longer term, and order from the NAVY for $1.75 million.
A quick check of the SEC filings
reveals this company has raised most of its capital from funds in a debt
financing which converts into equity at $1.10 per share. This means the
big money thinks they are going to make money above $1.10.
The reason I acted on the trade was
because of the way the stock was behaving. A quick look on the chart shows
a volume and price breakout. This is a pretty short term view. This stock
has been as high as $5, and Friday's volume of 540,000 shares was the highest
volume day since June of June of '07 when the stock scampered to $1.50
in short order.
I don't know what's going on behind
the scenes, but I sure like the volume and price spike. As I have been
saying, there is easy money to be made in micros in the first surge
on absurdly oversold small stocks. This could be a good choice for a trade.
I'm in there.
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