As you all know, I have been trying to get some info on commercial scheduling, so you can all have an approximate time to turn on the TV and watch the Cinnergen and Cinnechol commercials.

According to this week’s news, it appears the commercials are now being broadcast on Fox News, the Gameshow Network, Discovery Health, and the History Channel, and could eventually be viewed by as many as 300 million households.

I have learned that since we are still in testing phase, the scheduling can change on a moment’s notice. Therefore, the company does not want to publish a schedule at this time. If you were to look for the commercial at a certain time, and it didn’t appear as scheduled, the company is concerned investors will think there is a problem when there isn’t one.

I am informed this testing phase will go on for about thirty days- through the month of April. Once past, the schedule should be more predictable.

In the interim, you can view a couple different versions of the commercial at the respective web sites of the products, or just watch any of the above mentioned networks at your leisure.

Both these web sites appear to be very well done commercial sites. I note this, because there has been some griping in the past about their web presence. Visit www.cinnergendirect.com and/or www.cinnechol.com to view the respective clips.

This will be the first in a new series of daily blogs with some observations about today’s market action, especially as it applies to the current ideas I have in front of subscribers.

Open LEH Puts:

Well, the trade is working well so far. Earlier today I was up $2k on an $8k investment from last Friday, and tempted to lock in. Gave back $500 so far. However, since LEH was down yesterday on a huge up day in the markets, I have no reason to believe the stock is ready to head back up. Some downgrades today from brokerage firms, and they are rumored to be awash in bad mortgage paper. Let’s hang in another day.

VTOK: New Idea

The response to new idea VTOK was pretty anemic. I believe the story is reasonably compelling, but I don’t think the market really gets how big the Amerivon relationship will be. More will come out in the future.

SPKL:

Stock continues to languish on light volume. The company is doing great, but the stock needs a catalyst to get it moving again. They came out with their 10K, so I will do an in depth BLOG on it. Big winner in the next bull market.

EFSF:

Stock firming a little in a pretty brutal micro environment. I like the second test of the lows, and some volume starting to show up. Might get some legs in this one.

PNWIF:

Showing some signs of life today as it is oversold in a news vacuum. Costco services should start soon. Big winner in the next Bull market.

AAPL:

I missed it waiting for the all time bargain basement steal. I don’t believe the volatile madness is over, so might get another chance.

CREE:

In no man’s land. Sticking with my plan. I have my 2k shares in the mid 28’s- will buy more if I see it back in the $25 to $26 range- will sell calls against it in the $30s. Today, nothing to do at $29+.

Overall Market:

After a huge week and a big Monday, the market should be giving some ground, but it’s not. Bullish, but still half the day to go. The environment is finally improving a little, and perhaps the micro will start to show some signs of life before too long.

EFSF released fiscal Q3 numbers today, and there really isn’t anything but positives in the numbers. I looked, but I can’t find much of anything negative to say.

In fact, the balance sheet improvements are quite remarkable. For a pretty small company only doing about $1 million in annual sales, the balance sheet is great.

As of the end of January, EFSF had no debt, $1.13 million in cash, 428K in receivables, and $1.6 million in prepaid expenses. Guess what the prepaid expenses are? Advertising media buys for the coming campaigns.
On the minus side, you have $100k in payables- big deal. This balance sheet has improved by leaps and bounds in the past year.

There is one minor negative I could find- Shares I&O increased to 180 million from 165 last quarter. This is the price of not being profitable, and raising $1 million in cash. Note the big expense on the income statement for consulting- most of the share increases are built into that number.

On the revenue side - the percentage increases are great, but the top line number is still too low- only $310k for the quarter, which was more than 3 times the same quarter one year ago. Not enough, but the big media campaigns are about to start.

As you can see from the chart, the headlines are driving small stocks down, and EFSF is not immune.

The stock tried to break out above that downtrend line, but couldn’t hold. Might be a great mulligan for those who didn’t participate when it traded up in the past two weeks.

This company is perfectly positioned to launch these Direct Marketing campaigns. It’s starting by the end of the month. If it works, and the market starts behaving better, this one could really pay off from these levels.

I am posting this BLOG at about 9AM Pacific, Thursday morning. The chart below is hinting at some signs of life for EFSF. By the time you read this, I’m sure it will be later, so I don’t know how the chart will look then.

Here’s the chart:

As you can see, the stock hasn’t been much fun to own for the past year. However, the chart is showing signs of life. The Gap at $.18 from early 2007 has been filled, which is a technical positive, and the stock is trying to break out above a very long term downtrend line.

While the technical picture is finally improving slightly, the real purpose of today’s BLOG is to give you the opportunity to comment on the interview with the Tim O’Leary, the CEO of Respond2.

Here’s what I’d like to know. 1. Did you find the commentary valuable? 2. Do you feel Respond2 is the answer to the sales side of the equation for this company?, and 3. Has hearing the interview changed your viewpoint on the future of EFSF.

Of course, comments and questions on any other EFSF related issues are welcome. Remember, you comment won’t appear until I respond and post it to the site. Check back the next day.

It seems there is a magical force in the Universe to which all things gravitate. I am writing this today to inform you EFSF has succumbed to the forces of gravity, and headed just where I thought it might head in a year end tax selling blow out (see the last BLOG on 12/14). That’s what a lot of these kinds of stocks do when shareholders have been disappointed by a shortfall in anticipated results.

Without further ado, here’s the chart. I’ve blown it up and extended it to make the gap as identifiable as possible. Look at the two green horizontal lines that delineate the gap, and its subsequent filling earlier today.

The stock has now officially completed a round trip from the level it was when I first wrote about the company.

That gap you see on the left side of the chart was created the first time I wrote about the stock.

Like a homing pigeon, the stock has flown back to its coup. Vacuum filled. Nature happy.

Fundamentally, all I can say is the company is improving. Technically, now is the time to swoop in and grab this stock if you are a buyer. You know all the facts about the company. I have certainly covered them over, and over, and over again. Don’t construe this to be my recommendation you should buy the stock today. There is a lot of controversy and disappointment, and you can read all about it in the archives. I’m saying now is the time if you are a buyer.

If you like the company and you want to own more stock, set aside your fears. Despite already owning 1 million shares which become eligible to be free trading next month, I might jump into 100k for a trade in the am. Since I own a lot, this would just be a trade for me. You might think a bit more long term depending on your goals.

Comments and questions are welcome.

It’s all about monetizing assets. EFSF has assets- their products are their assets. They don’t appear on the balance sheet, but they are there. If they want their stock to trade much better than it currently is, they have to monetize those assets- or at least make investors believe they are going to monetize those assets.

Current quarterly numbers came out yesterday morning, and there were no big surprises. Quarter over quarter, revenues were up very nicely over the same quarter one year ago, and the company is continuing to do a nice job managing its cash.

Between cash and receivables, they still have over $900k, and liabilities are less than $100k. Who ever heard of a public company with less than $100k in liabilities?

Also, top line revenues are growing nicely- albeit not fast enough for shareholders, but nevertheless at a healthy clip. The top line, thanks to Cinnergen sales, was up from $198k to $327k- an increase of 65%- S&P 500 companies never deliver this kind of growth.

My conclusion- I still see this company as a kind of option that won’t expire on some very good products. They have a good portfolio, and they need to figure out how to monetize that portfolio to benefit their shareholders.

I believe steps are being taken to move in that direction starting next year. If they line up the right sales force, it will be interesting to see if the market is willing to give the company the benefit of the doubt before the sales roll in, or if the market needs to see the numbers come.

I’m not trying to defend their snail’s pace to market, I’m just pointing out some of the positives. I get enough negative feedback on the company, so I’m looking at the other side.

Considering the anemic sales history vs what we were led to expect, the company could be in far worse shape than it is. They can manage slow progress very well.

I want to be around to see how they manage prosperity.

The chart remains about the same:

I still believe this stock is a screaming buy if it comes back and fills the gap you see circled at the left side of the chart. For that to happen, it would have to trade down to $.18.

It has tried to get back there, but doesn’t seem to want to trade below $.20. It might never do it.

The lack of sales is already priced into the stock. The detractors are vocal, and have gotten their message to the company.

I believe there is lots of upside when everyone is so negative. Tax selling may force this one to stay in this range or go down a little for the remainder of the year.

It’s an accumulation right now- a screaming buy- even for a trade, if you see $.18.

EFSF- more news on the path to the retail shelves for the product they believe could be applied transdermally as a potential preventative measure and/or therapy for MRSA Staph.

They announced the company would be going into a laboratory, and using a “Gold Standard” test to determine its efficacy.

Test results will be the first step- assuming a positive result, the path to the store counter would have to be next. However, it strikes me that they would have to show it works in an actual human application somehow, which might be tough. We’ll see how it all pans out. It’s another opportunity in the portfolio of IP that “could” turn into something big.

On to the main topic- the one of concern to the followers of this company- when are they going to generate more robust sales?

Disciples seem to have a very short fuse on this issue these days. Most of the emails of BLOG comments I receive are centered around that issue. Investors tend to be viewing the recent slate of product developments almost as a kind of slight of hand- a distraction if you will to avoid the main issue.

Here’s what I know- the company is moving in the direction of superior distribution for its existing products. They are in CK41’s back pocket nearly daily- putting their best foot forward to get that moving. They are pushing forward on several other fronts that might prove very fruitful.

In the meantime, considering the current microcap market malaise, and the current level of shareholder unhappiness, this issue might be plagued with a bit of tax selling this year.

I’ve had a number of questions about last year’s January gap. Here’s the chart:

I’ve had to expand the chart considerably to show a daily going back that far, but nevertheless you can clearly see the gap.

On Jan 10, ‘07 the stock closed at $.18. On Jan 11, the stock opened at $.21, and never came back. Chartists call this a “gap”, and the theory is that all gaps eventually get filled. The whole in the chart acts like a kind of a vacuum to suck the stock back to that level, fill the gap, and start over.

I don’t believe there’s any logic to it. I do believe opportunistic traders will pounce on the stock if it ever does come back and fills that gap.

In the absence of any robust news on sales and/or a return to a healthy microcap environment this year, there is always the chance EFSF could “fill the gap”, at which point it would be a fantastic trading opportunity to go long.

I would guess the chances are worse than 50/50 for this drop for two reasons. 1. If investors wanted to make tax sales on this stock, they have probably done so already, and 2. I believe micros are going to pick up in short order.

Nevertheless, if this stock does fill that gap this year, I would pounce with reckless abandon. 2008 is a new year, with lots of new opportunity for achievement.

I’ve rarely seen a microcap company with so many potential blockbuster opportunities in its pipeline. I’m just asking for one big success.

Comments and questions are welcome.

More news out of EFSF this am on their newest product discovery. Just to review: Last week, EFSF announced a major breakthrough with a new application for Citroxin- their mold fighting product. In a clinical environment they proved Citroxin kills the highly publicized MRSA Staph better than the antibiotics currently used to treat it.

Today, just as the market opened, EFSF disclosed it has formulated a transdermal method for getting Citroxin into the blood stream. Transdermal does not work for all medications- molecule size has a significant effect on the compounds ability to actually get into the blood stream through the skin and be effective.

There are some questions that need to be answered. What is this new product’s path is to the store shelves? Does it require some sort of regulatory approval to be marketed, and what would be required to make the claim that it can be used to either prevent or treat MRSA Staph? My guess: EFSF will disclose its plan for a path to the store shelves over the coming weeks.

I was a bit disappointed last week when the market did not respond favorably to the revelation that EFSF had a potential all natural therapy for MRSA Staph. It’s a huge health issue, and a media darling. However, it’s another arrow in EFSF’s product quiver that could end up generating millions in sales under the right set of circumstances.

I believe investors are sending a loud and clear message to EFSF’s management- time to stop talking about products- time to start selling products. I’m sure management is listening and putting its best foot forward, but the market only appears to be ready to reward results.

Here’s the chart, and there’s not much to talk about:

As you can see, after having a rough summer in ‘07, the stock has been grinding in the $.23 to $.26 range. It needs some kind of major catalyst to getting it moving back up the charts once again.

While it’s true that the company is far behind where we hoped it would be in their sales cycle, there are some positives I believe the market is overlooking. The stock has remained relatively stable in price over the last month against a backdrop of the overall market blowing its brains out- there’s one positive.

Secondly, their extensive portfolio of very exciting products suggests it is inevitable they will have some sort of big commercial win at sometime in the future- probably about when investors finally lose patience and throw in the towel (we might be there now).

Thirdly, I don’t believe the company gets much credit for their darn good financial condition against a backdrop of disappointing top line revenues. Based on early ‘07 forecasts, Cinnergen, Cinnechol, and PurEffect should have both been delivering millions in revenues by now. They aren’t. Cinnechol isn’t even commercially available yet, and PurEffect is in the hands of marketing company CK41.

However, despite the less than stellar top line numbers, EFSF is generating enough sales to have the required cash in the bank, no debt, and loses have been minimized to a virtual zero. In fact, I wouldn’t be surprised to see the company turn a profit in the current quarter.

In summary, I believe EFSF is a heck of a good speculation right now. While the sales haven’t come in as expected, the risk profile has been reduced considerably by the near break even performance last quarter.

After the drubbing the markets have taken in the last month, this stock is probably poised for a rebound of some quality in the not too distant future. This is a great level for accumulation.

Comments and questions are welcome.

eFoodSafety finally got their annual 10K filing in late today, and everything is pretty darn ship shape on a go forward basis.

This financial statement is already nearly 3 1/2 months back, so it’s already kind of old news. When you read a 10k, you are looking for negatives the company might not disclose in a public forum. In short, I simply couldn’t really find any.

If you want to look at one minor negative- the number of shares I&O is climbing as the company uses stock to pay for a lot of stuff, raise capital, and reduce debt. As of July 9, there were about 164 million I&O.

On the plus side, the balance sheet is in absolutely great shape for a company in its development stage. They have no long term debt, and had about $1.1 million in cash at the end of April. Restricted shares were sold at $.25, which I believe is a very fair number for shareholders, to raise capital. Debt related to acquisitions was converted to shares at a number above the prevailing market- also more than fair to shareholders.

Revenues, primarily from sales of Cinnergen, climbed to $1.1 million for the year- double the previous year. This suggest a fairly robust Q4 as opposed to Q3 when they were just starting to sell Cinnergen.

All in all, for a development stage company with several commercial roll outs in the pipeline, they are positioned very well. Now, they just need to execute. PurEffect- here we come.

Here’s a look at the chart:

The stock has been going through a little consolidation phase, which I believe is a very bullish sign considering the drubbing the market has taken of late.

In short, this stock is poised to run up. I think it’s highly unlikely the stock will go down on the 10k- there really isn’t anything in it to spook investors.

I’ve included the 200 day moving average, which some avid followers of this stock tell me is the key swing point. A stock trading above its 200 day moving average is considered in a long term uptrend. The 200 day MA on EFSF is about $.31.

A little volume surge to the positive and off we go if they are right. Right or not, I believe this one could be setting up for a great second half of the year.

As usual, comments and questions are welcome.

EFSF is sitting in this mid $.30s range kind of grinding around. I wanted to share a couple of mid summer thoughts about this idea, and prepare you for what might be great, and what might not be so great.

Here’s what I am excited about today: PurEffect. PurEffect has the potential to be a huge product for the company. The CK41 team has launched a number of very successful products via infomercial, and now that we know the production has started, and there will be viable personalities endorsing the product, it makes for a great speculation at the get go. I have heard projections in the hundreds of millions in sales over the life cycle of the product, and in this case I believe we have a real shot. Remember- this is a recurring revenue product. Users must reorder monthly. If they use it and like it, sales could grow to unheard of levels.

Here’s a minor negative- Cinnergen- while I don’t know the exact levels, I can tell you Cinnergen is not taking off as robustly as the company would like. I know they thought retail distribution would be a little more widespread by now, and once the product gets on the retail shelf they have no control over how it is displayed. To their credit, they are taking matters in their own hands with the launch of the ecommerce site. All businesses will have challenges- it’s how they deal with the challenges that measures the upside. Eventually, this product should take off- Why? because it works. I know it works thanks to you. I have received emails from OTC Journal subscribers who are diabetics and take the product. They have reported to me that Cinnergen allows them to eliminate or take less of their medication. Once this is identified by the masses as a potential weight loss product, it could really rocket.

Oraphyte is simply a waiting game. I don’t know if Dupont will pick the product up for distribution, I can only hope. Someone erroneously reported that Dupont has rejected the product- it is not true- Dupont is in the testing phase right now.

Today, the company announced it will begin clinical trials for its Cold treatment, ColdZap. It’s probably a little early to factor this product into your thinking about the future, but if this is anything like Airborne, there is huge potential here as well.

Here are a couple of minor negatives you need to wrestle with if you are going to continue to be a shareholder: 1. You will no doubt here about AmeriFinancial registering to sell 1 million shares through Rule 144. This requires an SEC filing. I am informed Amerifinancial owns these shares through the settlement of a law suit. I am also informed they are limited to 10,000 shares per day and no more than 10% of the previous week’s total volume. This will not result in any major supplies hitting the market and sabotaging the stock price. However, the market makers might use the information to knock the stock down, in which case it would be a buying opportunity. I don’t know if this is the only incident of its kind pending, and I don’t know anything about the law suit. However, it is a non event in my view except in how it could effect the way the stock trades.

2. Minor negative, and this is ongoing- simply the number of shares I&O. Over the years, as this company has developed and had a couple of false starts, the number of shares I&O has grown to a pretty big number. The last quarterly number was 156 million, meaning at $.35 the market is saying the company is worth $56 million. 18 months ago there were 128 million I&O, so the number is remaining under control and growing at a very reasonable pace for a virtual pre revenue company. However, in order for the stock to go up $.10, the market must buy into believing the company is worth $15 million more. With the products they have ready for commercialization, it will take a bit of good fortune to see this one rolling up to $1 or more, but that’s the nature of speculation.

I won’t bother with the chart today. You will see a stock that has weathered it’s summer capitulation phase and has rebounded off the bottom. It is gathering the energy for another move- I’m not sure which way, but we are closing in on commercialization as some really big numbers over the coming months and years.

Comments and questions are welcome.

Now that the cat is out of the bag on Pur Effect, EFSF is wasting no time getting to work on going head to head with the virtually unchallenged leader in the specialized acne treatment world.

Today, just after the market opened, EFSF announced it had completed a study showing 94% of participants preferred Pur Effect’s 4 step treatment over a standard 3 step treatment.

While it doesn’t say so for competitive reasons, this is really a frontal assault on the strangle hold ProActive has on the Acne treatment market.

Personally, I believe the company is making all the right moves on this one. Unlike Cinnergen, where they are at the mercy of the retailers in terms of product placement, they are completely in control of their destiny with Pur Effect with its planned infomercial marketing.

Moreover, they have teamed up with some pros who have a long history of successful product launches via infomercial, generating hundreds of millions in sales.

And- even better- they don’t have to take one dime of risk. CK41 will put up all the money for the marketing campaign, and they will just split the profits.

Bottom line- I really like what’s happening here. Here’s the chart:

In short, the chart looks great. You can see the summer low, and you can see the nice uptrend in the stock. I feel the downside risk at this point in somewhere in the $.28 to $.32 range. The upside is a new all time high sometime later this year. In short, just buy this thing whenever it’s near the blue line. If it trades below $.28, you might want to sell to protect your principal, but I believe the summer low has been made.

It strikes me we are past some of the summer sell off lows, and several of our ideas could be ready for dramatic rebound phases. EFSF, NIHK, and CPNE all look ripe for rebounds, but I believe EFSF is the one to jump into today.

Last week, the company announced it was in the final stages of launching an ecommerce Cinnergen web site. Clearly, this means sales are not off the charts at the retail locations, but the company is taking steps to sell more product. It strikes me as a good move on their part.

Most of all, I like the chart. As you followers know, I love buying stocks at 61.8% retracements. I don’t like trying to buy them when they are falling. The old saying is don’t try to catch a falling knife- you’ll get cut. However, you have to look at them once they have fallen and are climbing back.

Here’s the EFSF chart:

Going back to the big upleg which started last January, the 61.8% retracement of that whole move is in the $.31 range.

The stock sold off rather violently in June, and capitulated down to about the $.25 level. It was at this point you needed to exercise some discipline and sell if you were short term.

However, it rebounded very quickly back to the $.30 to $.32 range, which tells me that is where the support lies. And, of course- it happens to be the 61.8% retracement level.

EFSF looks like it has great support at these levels and is ready to rebound. It’s simply a technical observation. The performance of the stock is a bit like getting the flu. It was sick for a while, but the patient is stable and clearly recovering.

Accumulate EFSF for a breakout move now. Be in before the patient returns to its former powerful self. New SSL- $.235

I guess it was inevitable. EFSF, which was the last hold out of this past season’s winners, finally succumbed to selling pressure, threw in the towel, and gave ground.

Frankly, I thought the stock made a valiant effort to hold up as long as it did while all the other small stocks around it were falling out of bed.

EFSF had been holding in the $.36 to $.40 range, a double from this past January. All in all, a pretty stalwart performance.

The stock start starting slipping on higher volume last Thursday, and continued selling off fairly aggressively through Friday and into this morning.

No doubt, the complete absence of news concerning fundamental progress out of the company over the last few months has been responsible for the recent drop in the stock along with a seasonally rough time for micros in general.

The company has four products worth getting excited about: Cinnergen- a natural product to control blood sugar levels; Cinnechol: A natural product to control cholesterol; Oraphyte: a natural product to control nematodes (round worms) in agriculture; and PurEffect: an acne skin cream product. There are several others the company is working on, but those seem to be the main focus.

Of the four, only one is commercially available, and I’m sure investors are getting impatient. Cinnergen is in stores and online- I have seen the add for it on CNN- sales must be growing for the product, and there is nothing but upside there. However, there hasn’t been any news for at least two months on Cinnechol, Oraphyte, or PurEffect.

Cinnechol was supposed to be available by now. Oraphyte is being evaluated by Dupont. PerEffect is supposed to be going to market via informercial, but there is no public information on the status.

So, is it any wonder that in a seasonally rough time, shareholders of EFSF are becoming a little impatient and the stock is getting hit?

So, where does that put us now? Here’s the chart:

This is a daily chart going back to when the stock started behaving much better early in ‘07 and the OTC Journal starting covering the stock. The first day, you could have picked up all you wanted in the $.20 range, so it’s still a 50% move from January- great by any standards.

However, if you paid up for the stock and you are still in it, you have to consider your options right now. My SSL was $.32, and it is trading below that level. If you haven’t sold and are interested in preservation of capital and willing to walk away, you need to sell now.

If you still like the company and where it is headed (we all hope), now you simply have to hang in there and take a longer term view.

I wouldn’t rush out to buy it today- I’d like to see it hang around in the $.30 range for a few days to convince me the “hot” money is out. This is the 61.8% retracement level, and the stock is likely to gravitate there for the time being.

Of course, then you run the risk that the company will come out with some market moving news, and the stock will be right back in shape.

I guess Rome wasn’t built in one day, so we need to have a little patience with this one. Typically, here’s what happens. You finally give up and throw in the towel, and then the company turns around and delivers big news after months of waiting. Isn’t that typical?

Most if not all of the damage has probably been done. If you haven’t sold, it might be a good idea to hold your nose and hang in there at this point. This one could get hot overnight- there are a lot of investors watching the story, and the company has a very loyal shareholder base.

Comments and questions are welcome.

Those of you who read my review of EFSF’s last quarterly earnings release know I expressed some concern about the company’s balance sheet. In essence, their debt was about equal to the cash they had available for operations, and hence it appeared, at least on the surface, the company would suffer some cash constraints.

This morning EFSF put out a press release which alters the balance sheet landscape completely, and puts the company back on firm financial footing- they are perfectly positioned from a cash point of view to execute the Cinnergen roll out and move onto the other products they have in the pipeline.

The real eye opener here is the way they got rid of their debt. EFSF announced the debt holders converted their $1.5 million in both long and short term debt into restricted shares at $.55: WOW!!!!!!!!! - anotherwords- the debt holders just bought $1.5 million worth of stock for $.55.

With EFSF currently trading at about the $.40 threshold, this move represents a tremendous vote of confidence in the future of both the company and the stock price.

Here’s the chart in the early going:

The stock, which came down after last week’s surge above $.42 on the Cinnergen news, is surging again today on this news.

I would love to see it eclipse last week’s high, and set up a series of higher lows and higher highs. Whether it can or not, these kinds of high volume days act as a cleansing mechanism to take out the sellers and replace them with long term buyers- thereby setting up the stock for its next big move up.

The next big step would be to break the long term downtrend line. That would be huge.

Whether we make it above last week’s high or not, this thing is setting up for a big move. As I predicted, EFSF is starting to get noisy again, so look for more.

The debt holders just bought 2.7 milllion shares at $.55. How much do you want to own at $.40? What a vote of confidence.

Comments and questions are welcome.

I knew EFSF was just ready to break out. The chart was just too perfect for the stock to not have a great day yesterday.

So-what now? What if you didn’t “accumulate” as I suggested back on April 10th and get positioned for yesterday’s big surge? What if you want to buy the stock? How do you do it without chasing the stock and paying too much?

My guess, the stock is now going to enter another series of higher lows and higher highs, which I hope ends up in a very significant long term break out.

Here’s what we do- go back to old reliable- accumulate the stock when it gives back 61.8% of its recent gain. Where is 61.8%? Glad you asked:

Here’s the chart:

The 61.8 is circled. It’s just under $.38. Remember- this is a very short term look. Just a matter of a few days. Ideally, you would like to see a 61.8% retracement that holds and extends out for a number of days while the volume dries up. The longer the time frame, the more accurate predictor.

Here’s another guess- I believe we will now embark on a another series of events from EFSF. After being quite noisy, the company was rather quiet for about a month.

This company has a history of making noise in the 4 months I have covered it, and I expect that trend to continue until proven otherwise.

Therefore, $.38 might prove to be the right number, with the next surge taking the stock above yesterday’s high of $.425. When you’re looking this short term, it’s tougher to predict, but the principles still apply.

Here’s what I find amusing- What if a NASDAQ stock had jumped from $35 to $42.50 yesterday- a $7.50 move? It would have been all over CNBC and the Wall Street Journal. Yet, in our little market, it doesn’t get recognition.

Oh well- I’ll take the percentage gain, and look for another.

Comments and questions are welcome.

Class, we are in session again. Trading 102 this time. As a reminder- what do we do when stocks we like are trading up on high volume, spiky surges? We lighten up. We sell part or all of them (see NIHK).

And, what do we do when stocks we like are trading listlessly, on pullbacks, and no one wants them or cares anymore? We accumulate.

Tongue in cheek aside, all the traders who were previously infatuated with EFSF as it had its two month run from $.18 to $.50 are no longer paying attention. Why? because the stock has been quiet of late and dropping on light volume in small increments. It has been a lackluster market environment as the soothsayers on Wall Street try to figure out why last week’s jobs report was so great against a backdrop of the foreclosure epidemic. If you believe these guys, you would think the lousy 1 million at risk mortgages are going to bring the economy to its knees. $75 oil couldn’t do it- so why should a minuscule percentage of high risk loans do it? Please.

If you like EFSF as I do, you have to pay attention now- Why? because no on else is paying attention now, and the stock has retracted to a very favorable entry level.

Without further adieu, here is today’s chart:

Here’s what jumps off the chart to me. Look at the volume dry up in the stock. As the stock drops listlessly, traders lose interest.

Also, look at the perfect 61.8% retracement as measured from the $.25 level- it’s first stop north of the original $.18 entry level. Anybody pick up CPNE last week at $1.65 when I called the prefect long term 61.8% retracement? It closed at $2.04 today.

Numbers should improve dramatically for the remainder of this year. This company has a number of home run hits in the line up. Cinnergen sales are now picking up daily, and several other products are nearing commercial introduction.

Of note- my SSL on the stock is $.36. It’s just a suggested level, and a level where it is time to re evaluate. SSL revised to $.30, where we can re evaluate again if we ever get there.

In light of the low volume relatively speaking, I believe in this case it is more of a buy than a need to protect your principal.

The company has been quiet of late, but anyone who follows this story knows quiet doesn’t last long with EFSF.

Accumulate while no one is watching. You can be a seller when they’re all piling in and the stock is going up because it is going up. (Again, see NIHK).

Comments and questions are welcome.

EFSF is a real champ. The stock could easily have fallen apart in this big market decline, but it is trading solidly within 10% of its all time OTC Journal high. The stock appreciated 150% since I first introduced it to subscribers; this is remarkable when considering the current market climate. Its stubborn refusal to give ground provides a hint that this one might just power much higher when the microcap switch flips back on.

If you are wondering where I would buy it right now, here’s a very short term chart that will give you an idea:

The chart measures the 61.8% retracement from the recent move the stock made in conjunction with the news of WalMart carrying the Cinnergen product.

Here’s what the chart tells you- On a very short term basis, the stock should be accumulated if it gets into the $.415 range.

If you wait patiently, and the overall market continues to grind as it has the last several weeks, I would expect this stock to probably drift down to that level. Of course, news could drive it up.

Here’s a chart of the downtrend line, which I believe is screaming a message at anyone who believes charts mean something in the stock market. This downtrend line goes back to the very first trade in the stock, and it has never been convincingly broken to the upside. It represents nearly three years. The longer term your look, the better predictor of behavior.

The stock has made two attempts to bust through this downtrend line this year. The stock is not giving much ground on the pullbacks, which means there is a loyal shareholder base with a long term perspective.

It might take 1, 2, or 3 more attempts to bust that downtrend line, but I believe it is inevitable. Once it breaks through convincingly, it will be tough to predict how high it could go.

Bottom line: My suggestion is don’t sell it if you own if you are trying to buy it back cheaper. It’s too risky- the company could deliver something big.

Accumulate at or around the $.415 level if it gets there.

Comments and questions are welcome.

For who were reluctant to jump on EFSF as it cranked up the charts in pretty short order, this week’s market meltdown has opportunity written all over it.

If you look back to previous blogs and editions, I suggested caution if you were considering opening a position as the stock charged towards the $.50 level.

This week’s market meltdown has investors locking in profits in these high flyers. Finally, after three months of moving pretty much straight up, you have a shot and accumulating this one at a much lower risk entry point.

A market blow off was inevitable. The overall market has been streaking since last July, and this week’s 3% correction was long overdue. Everyone was simply looking for an excuse to sell and take a few shekels off the table.

For those of you who are new to the OTC Journal, you will find Fibonacci Retracements are a continuing theme in my technical comments. Leonardo Fibonacci was born in 1175 AD, and was a mathematician 300 years ahead of his time. His Fibonacci ratios constant recur in nature.

There are the ratios that constantly re appear- .382% and .618%. Its uncanny how often it works. One of these days I will write an article about it again.
Here is the current chart of EFSF- with the two Fibonacci ratios in the chart:

This chart measures EFSF’s one month scamper from just under $.30 to a high of just over $.50.

Note the perfect 61.8% retracement from the move is $.354, just above my SSL of $.35. Once the 38.2 gives way, stocks almost always go to the 61.8. If you believe this week’s market blow off was an abrupt and violent long over due correction in an ongoing bull market (as I do), now is definitely the time to snatch up this stock.

Here’s why- the best time to accumulate these kinds of stocks is when they are quiet, have pulled back, and everyone is afraid. That’s when you will always make the most money. Secondly, when you snatch a stock up on a 61.8% retracement, you can set your stop loss fairly close to the market. If it drops much more, technically there could be hard times ahead. Thirdly- when stocks drop due to macro market conditions, not events directly associated with the company, those generally become opportunities as well.

Therefore, if you like this one and have been worried about getting injured by trying to jump on a speeding train, now is the time to make your move.

Pick it up now. SSL- a minor adjustment to $.32- risk 10%. It could turn back up very soon.

I’ve been a little behind on the content of late, but am getting caught up now. EFSF deserves some observations as my targets keep being blown away, and the strength of this stock causes me to continue to upgrade my target price.

My $.40 price target was breached two days ago, so if you sold the stock you should have made a great profit. Never look back.

This one has almost been too easy. There are a lot of fervent believers in this company, and now that it has woken up, so have many loyal shareholders. $1 is probably in the crosshairs sometime this year, but many feel much higher levels are in store further down the road.

Technically, this stock is behaving like a well trained hunting dog. It goes exactly where its master expects. Here’s a chart I published in the BLOG on Feb 9:

This is a very long term look at the stock- in fact, it goes back to when the company first traded publicly.- 2.5 years ago.

I predicted the stock was destined to get up to its long term downtrend line. That was a fait accompli. Where the stock went from there was technically far more interesting.

Here is the same chart extended out to today:

Look at the way the stock went straight to the downtrend line before offering any kind of correction. Absolutely wonderful.

So, where to from here? In my view, the key still remains in the long term downtrend line. If the stock can get through that line with vigor, it will signal a major trend reversal in this stock, and from there the sky is the limit.

I suspect it might take several efforts like those of the past couple of days to really breakthrough and breakout. In technical analysis, persistence breaks down resistance.

I believe it could take one or two more tries, but once we breach the downtrend line it’s going to get really exciting.

So- here’s what you really want to know. What do you do now? Good question. The company has not delivered much news of late. Any positive developments could send us much higher, and something is overdue.

Since the move has been so short term, here’s a short term look at the current good and perfect entry levels:

These retracement levels only cover the last six days, so it’s pretty short term stuff. Not to worry if these levels don’t hold up- we just have to look a little longer term.

According to the chart, $.44 is a good entry level, and $.395 is perfect. As such, I would now set the short term SSL at $.355.

The company is due to come up with something exciting in the near future, so if your not on board, don’t waste too much time.

Fervent believers are looking very good right now. I hope the company makes them look even better.

Comments and questions are welcome.

Technically EFSF is acting like a champ. Of late there hasn’t been much fundamental news, but the stock is simply taking off and made a new post OTC Journal coverage high today.

So, what are the chances of EFSF taking off like CPNE and PNWIF?- not just making post coverage highs, but making new all time highs on both the technical and fundamental side?

Let’s look at the fundamental side first. On the fundamental side this company will definately be making new all time highs on the top line. How do I know? Because they simply can’t go any lower than they have in the past. Cinnergen (look in the archive section if you want to read past articles concerning their products) is their first commercial product. It is being advertised nationally in short TV spots, and being picked up by retailers all over the place. By the end of March, they expect to have the product carried in over 10,000 retail locations.

Behind Cinnergen they have the Pur Effect product introduction coming, the Cholesterol product, and Oraphyte on the bio agri side. Therefore, it is reasonable to assume the top line will continue growing quarter over quarter for the foreseeable future.

This past week’s action in the stock makes the technical side very interesting. Frankly, it’s causing me to rethink the potential for the stock. Readers know I originally pegged the short term target price at $.30. It traded through that level far too easily and quickly, which caused me to raise the target to $.40.

This week’s action caused me to take a very long look at the possibilities, and here’s the big picture:

This is a weekly chart going back to when the stock opened for trading- at least as far back as my software goes. It measures the price movement week by week. The daily is too noisy to go back three years.

The blue line is the multi year trend line. As long as the company continues moving forward and the market for micros holds up, I believe this stock has a date with the trend line. At this point in time it would be around the $.50 level. The longer it takes, the longer the trend line extends, and the lower the price.

I believe getting to that trend line is pretty much a done deal. Far more interesting is what will happen when it gets there. If it can break the long term trend with volume and conviction it will be a whole new ball game and a dream situation.

One thing we have going for us- the company has no long term debt and no equity financing in place. It was all done some time ago, and it’s all over with. That is one reason the stock is trading so well.

Once the stock gets to the downtrend line I believe it will break out if the company is delivering catalytic events on the product introduction side.

Does this mean you should run out and buy it today at this new multi year high?- If you already own it or not, keep some money handy for a pullback, but a position at this level is fine as long as you realize there could be a correction again. Keep checking the BLOG for a good entry point.

Comments and questions are welcome.