MicroStockProfit

Stock screens are only indicators of trend.  They don’t speak about a company’s potential, its challenges and its future.  But, for those of us who are technical analysts, they do tell a story.  A story that, if you read it right 70% of the time, will make you very rich.

On my daily stock screens today, I came across a chart I liked.  Once I did my research, I found that I liked the company very much, too.

ChinaTel Group, Inc. (CHTL)

Like a lot of China penny stocks, it is incredibly volatile.  Lately, they have been on a pronounced downtrend.  Talking with their IR people, they surmised that investors were unhappy with the about their March 5th PR concerning amendments to stock purchase agreements for some major holders and a disappointing capital raise.  Investors/traders were expecting a great deal more money…and, ChinaTel needs it.

They are setting up wireless broadband telecommunications networks throughout certain regions of The People’s Republic of China.  Their first installations are in China with grand plans later of expanding to other countries such as Argentina and Peru.  Their plan is to leverage WIMAX technology to emerging markets.

Revenues are miniscule compared to expenses (hence the need to constantly raise capital).  But, I am not looking at CHTL as a fundamentals trade (because they stink anyway).  This play is about riding the ups and downs of a stock that is sure to have many in the next several months.

Right now looks like a good time to get in with the expectation that the trend will reverse soon.

Here is the chart with my annotations:

Investors are entitled to be unhappy in the short term….CHTL needs more money and every capital raise dilutes us poor retail investors.  However, it appears that the company is the “real deal” and will be around for the long term.

I would not be a long-term investor in CHTL just yet, but playing the volatility is fine.  I never call bottoms and I won’t in this case.  If the current support proves to be durable, I think that CHTL could return some nice gains for the nimble investor.

Trade with your eyes open,

Jeffrey Dean, Editor

Yamana Gold, Inc. (AUY) is still reeling from the beating it took from the Street and the financial press for its last Quarter/last year’s performance.  AUY missed every meaningful benchmark (revenues, cost per ton, production volumes, etc…) and those misses are compounded by the stagnant gold prices recently.  To say that AUY “missed” those benchmarks is not to say that the company is in any trouble.  It is still profitable and has a strong balance sheet, but the market is looking for AUY to continue to be a low-cost producer and for growth.

BUT (and, that is a BIG but), AUY might be a great chart play.  It is showing that it could bounce off of near-term support and deliver a short-term gain to savvy traders.

Here is the chart with my annotations:

“Is the bad news burned into the stock price” is the simple question that traders should ask themselves.  I think that it might be.  Historically, AUY has had great elasticity and bounced off of oversold levels and returned some nice gains.  If you were to do a year chart on AUY, you would see what I am talking about.

AUY could be a nice short-term trade.  Any breaks below support and the stock should be avoided until it can build a new base…or it can issue some better news.

Here is a little info on IsoRay, Inc. (ISR) from their site:

IsoRay, Inc. engages in the development, manufacture, and sale of isotope-based medical products and devices for the treatment of cancer and other malignant diseases in the United States and internationally.

I like the chart setup….It looks like it may have a short term bounce in it.

** Consolidating at current levels

** Support at $1.00

** Stochastics are entering oversold status

** MACD is still bullish with no trend

A quick glance

A quick glance at the financials and I was impressed.  The company has revenues (but still posting losses).  It has a clean balance sheet with cash and no debt.  I think the downside is low with this one.

Good luck and good trading,

Jeffrey Dean

I was doing my scans this morning and came across GLU Mobile, Inc. (GLUU).

Simple company to understand:  Glu Mobile Inc. designs, markets, and sells games for mobile phones worldwide.

Here is a few places for your DD:  Yahoo! Finance and company site

The Chart

** Indicators are turning positive finally
** MACD bearish momentum is finally slowing and could reverse
** Volume has slowed and selling pressure appears to be easing
** Stochastics are oversold.  If MACD continues to strengthen, a bounce could be possible

Do your own DD, but I like this chart for future gains.  Co. outlook has gotten it hammered, but the company is still bullish on its prospects.

Jeffrey Dean

Editor

I took Spanish in high school (Yo quiero muchas cervezas, por favor) so my French is pretty weak.  All I can figure out from the name of today’s Blog subject is that is means “Big bottle of Gold”.  Strange name for a tire recycling company…..unless it means big profits for the shareholders.

Magnum D’Or Resources, Inc. (MDOR) is quite simply a tire recycling company.  Until late last year, they were a development-stage company.   They recently made that all-important transition to a revenue-producing company (albeit small revenues).  I had a long talk with some people associated with the company and they had some big hopes for the company.  The company has, through a joint venture, patented technology that they believe will be a game changer.

Here is a short description from the company’s website:

“The Company is able to produce rubber nuggets, buffings, crumb rubber and ultra fine powders which are all used for various industrial applications. Magnum caters to two main markets, Rubber and Home & Garden. Magnum’s technology and processes optimize the grinding and purification and produces on a large scale the finest rubber powders in less than 0.250mm size. The process also is approximately 40% less expensive than available technologies. These features provide the Company with a competitive advantage.” (emphasis added)

I am recommending to my members and readers that they put MDOR on their radars.  There are a number of things happening with this company that might make for a higher price stock in the near term:  Buzz, news and chart.

Let’s talk buzz first - MDOR is supposedly putting the finishing touches on a promotional video/puff piece that is supposedly going to get national exposure.  Read even more buzz for yourself at this link.

News - MDOR has issued a steady stream of positive news.  What I like when I read it is that it seems to be factual rather than hype.  They still aren’t saying the magic words like “high revenues”, “multi-million dollar financing”, but the news gives the impression that they are moving forward.  Also, any positive news along the lines of what I just mentioned will send this stock FLYING.

Chart - My annotated chart below points out some of the positive indicators as I see it.

I had done a research report on MDOR back in September when it was a 50 cent stock.  You are welcome to read it….it goes into considerably more detail than this blog and most of the information is still relevant:  Click here for MDOR trade overview

One of the challenges for the company is to secure the financing so they can fulfill the enormous contracts they have landed.  MDOR is not out of the woods yet, but they can see the edge of the forest (IMO).

One of my readers (Chris B.) emailed me about MDOR when it was at $1.34.  I didn’t think it was a buy at that point (I thought it was extended and i was right), but it could be now.  If you or Chris trade it, make sure you bracket your trade properly.  I really like trailing stops…I always believe my picks are going up BIG.

Definitely a good radar stock.

Good luck and good trading

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