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When will Generex Biotechnology (GNBT) stop falling?

Editor — Wed, 14 Apr 2010 13:32:25 +0000

GNBT has been around forever in the pennystock world. It has been touted as the next Nasdaq stock (or a piece of crap that is going to zero) in the time that I have been watching it.

It definitely isn’t going to zero, but right now traders and investors are down on GNBT…..for good reason.

Generex Biotechnology Corporation (GNBT) is a biotechnology company that is working on variations of its drug delivery systems for diabetes (and other illnesses). Here is a link to their site if you want to do more DD.

GNBT has been trading in a range between $0.40 and $0.70 for the last 6 months. Right now, it is trading at the bottom of that range.

I am not recommending that anyone “catch the falling knife” on this one, but I am thinking that GNBT is prime for a reversal. For all of the negative press that GNBT has been receiving, the news that they have received a financing commitment is a positive indicator. True, the financing is at a discount to GNBT’s current trading price. But, the commitment is real and they have already drawn the first tranche. It is composed of 24 tranches. The financing guys are not stupid. They want to be able to limit their exposure if things get worse for the company.

The negative press stems from the ever-irascible Adam Feuerstein of TheStreet.com, who called out GNBT and labeled them frauds. The company responded with a $250 Million defamation suit. I like MIchael Fizhugh’s article on SeekingAlpha.com about the whole mess. Read it here.

The Chart

Clearly, GNBT is in a downtrend. But, there is hope for a recovery. In the last 5 trading days, there has been 3 high volume selling days BUT there have been two up days. All the news is not bad. It looks like buyers are trying to bid up the stock. The oversold stochastics will exert some pressure for a bounce, but with the MACD still bearish, the stock could continue to fall for a while yet.

Watch for the MACD histogram to indicate that the bearish trend intensity is lessening. Another indicator that I am using lately is On Balance Volume (OBV). That indicator is telling me that the stock is still in distribution.

I am not qualified to pass judgment of GNBT’s drug portfolio. I look at anecdotal information to give me some idea of whether this stock has a chance. The financing is a huge indicator to me that GNBT will be around a bit longer. The company has plenty of cash, low debt, great ratios….that will help them see this “crisis” through. Any good FDA news and this stock will fly….Bad and the reverse will happen.

GNBT’s volatility is a great thing for short-term traders like us.

Trade with confidence,

Jeffrey Dean, Editor

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KOPN has no reason to be this cheap.

Editor — Mon, 05 Apr 2010 21:09:42 +0000

I like Kopin Corporation (KOPN). The name of the company isn’t exactly thrilling, but the fundamentals are. The company should have a more tech sounding name…for what they do. Techstorm is nice…NanoVision would be better, too. Anything is better than Kopin.

KOPN produces lightweight, power-efficient, ultra-small liquid crystal displays (LCDs) and heterojunction bipolar transistors (HBTs). They are a world leader in both of their main lines and are being well rewarded by the marketplace for that position. They just posted their 4th best quarterly performance in their history. They have tons of cash, no debt, awesome margins and ratios. The company appeals to my CPA side.

However, all this good news and positive vibe isn’t reflected in the stock price. I went a little overboard with my analyis. I don’t usually include so many indicators and information. I hope it is still instructive (and legible).

KOPN Chart

I like KOPN as you can tell. It is having a bit of a dry spell, but I think it will come back strong.

Jeffrey Dean

Editor

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SAY Hey! for Satyam Computer Services (SAY)

Editor — Thu, 01 Apr 2010 20:01:01 +0000

Apologies to Willie Mays for using his nickname…..

Mahindra Satyam (formerly Satyam Computer Services Ltd.) (SAY) is still picking up the pieces from its humongous accounting scandals. Law suits are flying all over the place and SAY is dealing with a great deal of uncertainty: global downturn in IT spending, repercussions from their scandal and strong competition.

From a chart standpoint, they may be ready for a bounce. It will be interesting to see if they can hold this support level. They dipped below it on an intraday basis and rallied strongly. Any good news and they could run. The stock has been trading for the last 6 months in a wide band between $4.40 and $6.50.

SAY could be a great radar stock.

Trade like you mean it!

Jeffrey Dean, Editor

P.S. I personally like them because I am a HUGE soccer fan and they are the official IT Services provider for the 2010 FIFA World Cup! Maybe if I do a really positive blog on them they will give me tickets to the Cup. I saw the 1994 World Cup final between Italy and Brazil. I’d like to see another one.

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Time to take a look at Netlist (NLST)?

Editor — Tue, 30 Mar 2010 13:10:02 +0000

Netlist, Inc. (NLST) was one of the great stock success stories of 2009. The stock limped along at around 60 cents for much of 2009, but then caught fire and zoomed to $8.00 per share in the magical month of November. With the news of the impending release of their “game-changing” memory module, they took the market by storm. The product allows the server to believe it has more main memory than it is supposed to and is expected to put them in direct competition with Cisco (CSCO) and with a competitive advantage.

Since its almost 900% gain in November, things have been pretty quiet for NLST. In fact, the overall trend of the stock has been down. The company itself is still strong. NLST is still posting losses, but the gap is narrowing. Its balance sheet shows a great deal of cash, no debt and strong liquidity ratios.

The chart is where I want to focus your attention on.

Since I am a short-term trader, I don’t expect to be around in this stock very long. Short-term, it might be setting itself up for a bounce. There are a great number of people that are trapped in it at higher prices who will be selling into any strength. That is why (absent any news) any rally will be short-lived IMO.

Have fun and trade well,

Jeffrey Dean, Editor

Sometimes, it’s all about the chart: AMKR

Editor — Tue, 03 Nov 2009 13:50:47 +0000

I’m not sure why AMKR has dropped so far, so fast. It appears, on its face, that the company is doing the right things and the news has been mostly good. Doesn’t matter…persistent selling has knocked off 50% of the company stock price since its most recent high.

Here is the chart, so you can see what I am talking about:

It is a large company (definitely not a penny stock) that is involved in the semiconductor business and has had some “choppy” financial results lately. What I mean by that is that it has posted both losses and profits on different quarters in 2009. The balance sheet is reasonably strong….good cash and liquidity ratios although debt is high (over $1.5 Billion). Nothing to worry about there.

Why the drop? I took a quick peek and couldn’t find anything. I will do further research later, but for now I wanted to bring this company to my readers attention. I think that it has a very attractive chart, is sitting on or near strong support, it is in an industry (semiconductors) that seems to be getting “off the mat” and has the financial strength to weather this financial storm we are in.

It did bounce off support yesterday….I would suggest watching to see if it re-touches support or continues its bounce.

Enjoy your day in the market!