MicroStockProfit » sub-penny stocks

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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I am betting the luster comes back to Yamana Gold (AUY)

Editor — Wed, 10 Mar 2010 15:53:01 +0000

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.

Pure Chart Play: JCDS

Editor — Mon, 28 Sep 2009 14:58:00 +0000

I have programs that send me emails of charts every day. I pick the parameters and I get dozens of charts to view. One chart that stood out for me today was one for JC Data Solutions (JCDS).

Here is the chart:

The stochastics indicate that this stock is clearly oversold. it may have farther to fall since it is in distribuion, but it clearly has some pressure to rise. A sub-penny stock, it could fall as low as $.00075 before it corrects and rises again, IMO.

This is a non-reporting pink sheet company so the risks are known. They say that they have been in business since 1996. JCDS has put out a number of press releases that seem to indicate that the company is on a positive trend. But, companies have been known to lie in press releases (shocker, huh?). They have a website that gives information about what they do: click for link. They need to put a few dollars in the website…it really doesn’t show the company off well and is very dated.

Extremely risky…..short term play….put it on your radar….good luck and good trading

Is BEHL ready for a comeback?

Editor — Thu, 17 Sep 2009 14:41:46 +0000

BEHL was going to be the next SPNG….to hear traders talk. it was going to be so huge that it would dwarf SPNG…etc…etc… My chat room, Stock Hideout, even opened a chat room specifically devoted to BEHL back in August. It was at around that time when BEHL stalled. Nothing seems to be able to kick start it.

BEHL is a company that is best known for the manufacture of a closed loop algae bioreactor systems for the commercialization and production of algae. Here is their website for your own DD: BEHL Website

It just might be time to look at BEHL again. The chart is looking promising and the stock has taken a long breather. Might be time for a little action!?

Stochastics indicate that the stock is approaching oversold status and volume is slackening. Add some volume (maybe on good news or the stock just gets hot again) and I think this stock could zoom. I have no proof of that beyond a hunch. It is trading at the lower of the Bollinger Bands and the last time that happened it got a bump of about 40%. One thing that worries me is the it is sitting above the next support level (3 cents). Will it drop to the next support level? I don’t think so.

BEHL is, IMO, a huge risk, but one that might be worth taking. They have a manageable cash burn rate, a few dollars in the bank and are in a “Green” industry that is hot. They are master of PR and could come out with something truly meaningful that would send the stock flying. Their “interim financial reports” on pinksheets.com are chock full of information (not all of it relevant). it is like they are trying to convince you of how great they are by a sheer volume of words.

This is one of those penny plays that will fly or die (I’m really going out on a limb on that statement). I am seriously considering investing in BEHL for my own account. I have a feeling that BEHL is just resting here before the next step up. We shall see.

LLBO – Buying the Promise?

Editor — Tue, 08 Sep 2009 13:12:53 +0000

Another of the penny stock chat room favorites is Lifeline Biotech (LLBO). It has been a hot topic off-and-on for many months.

LLBO’s buzz is that they have the next generation medical device that can identify and locate “breast abnormalities” i.e. Breast Cancer. I have known many women who are breast cancer survivors and their best tool in this fight is early detection. That gives LLBO some instant cachet with their device.

According to LLBO’s press releases (and there are many), conventional mammograms miss 20 to 30% of cancers. LLBO’s First Warning System has a 95 to 100% success rates in identifying tissue abnormalities.

LLBO’s story is compelling, press releases seem to indicate that the company is heading in the right direction…even the chart is looking favorable. There is so much that is not known, though….they are a non-reporting sub-penny stock that is touting a revolutionary product yet we know nothing beyond what is in their press releases. This is a typical sub-penny stock!

Here is the chart:

LLBO soared to 2.5 cents in late July and has since sunk back sub-penny status ($.004). Stochastics are indicating an oversold condition. The MACD is sliding sideways in a midly-bearish direction. LLBO is trading at the lower of the Bollinger Bands and has slipped below the 50 and 200-day MA.

I can’t even begin to use my crystal ball on this one. It has the makings of a good penny stock and could be subject to some strong price swings. That is where the opportunity lies for traders.

Several factors make this a high-risk play: 1. They are trying to raise capital (I can’t understand why it is so difficult….if this product was everything it is being touted to be then investors would be lining up at the door). 2. The company has started the FDA process…it is a medical device not a drug which makes the process easier, quicker and less expensive…we hope. 3. You have to rely upon PR to know what is going on with the company…not always the best way, either.

Definitely a radar stock that I would recommend. Here is their site for your own due diligence: www.lbti.com/

Good luck and good trading.