Will These Mining Stocks Drive the Penny Stocks?

Will FCX and Copper Propel the Penny Stock Market?


copper penny stocks Will These Mining Stocks Drive the Penny Stocks?Recently we have seen a rally in copper prices, which historically indicates a rally for U.S. equities. Freeport MacMoran Copper and Gold (NYSE:FCX) has come back into favor and has always been a darling of short term traders and hedge fund managers. FCX is one of the few NYSE stocks that moves like a penny stock. Keep in mind that FCX could have a massive move in either direction. The optimism in copper prices last week leads some investors to go long equities. At this point FCX is a good of a barometer for the direction of the market as you can find.

Now if copper continues to rally the S&P 500 could close above 1120. The 1120 range is very important because there is an opinion in some circles that a break of this number will cause massive short covering. A break to the upside should spur some action in not only copper penny stocks, but to many quality OTCBB stocks as well. Now is the time to start getting prepared. One route is to start reading different news stories and compiling a penny stock list and a large cap list. Also, check out penny stock newsletters that have recommended copper and mining stocks in the past. Then break down these stocks into your top ideas. For instance, most traders are familiar with FCX, but don’t know that Southern Copper (NYSE:SCCO) and Encore Wire Corp. (NASDAQ:WIRE) move on copper prices too.

Gold stocks have been beaten up recently but have stabilized due to weakness in the dollar. So while gold and silver penny stocks may rally too, they may play second fiddle to copper related stocks for a brief period. Wheat has also rallied sharply based on the Russian drought. The stars seem to be aligned with the commodity stocks, but this market has provided us with multiple head fakes. So due your research and consider playing some low priced commodity stocks if they make sense for your portfolio.

12:48 pm | Vanessa | Tags: , | No Comments »

Stock Alert SILA

SILA – Gold American Mining Corp


gold american mining corp sila Stock Alert SILAWe have an exciting new gold play right now. Gold has pulled back 5% this month with the recovery in the markets but is still holding a strong 26% gain over the past year. Investors who don’t invest in physical gold look for the next best thing and that is gold stocks. The market is still in a bearish trend and generally when this happens gold stocks are still in play.
We have found what we believe could be the next junior miner that could be making major headlines.

We want everyone to put SILA (Gold American Mining Corp.) on your radar immediately.

This is a company that has made some very big moves lately and has pulled back nicely. Last week the stock moved from $0.80 to $1.16 (about 45%) and I’m expecting we could see a move like this again early next week.

According to Emerging Stock report SILA has Support at $1.03, with resistance at $1.15. There has been a lot of accumulation at higher levels which typically means there will be little resistance in the stock until investors reach the breakeven level.
We could see a nice pop and some momentum before we see any heavy selling.

SILA is extremely liquid right now. The average volume over the past two weeks has been 800k shares.
Recent activity has pushed the market cap to close to $80 million!!

Every mining company has to have adequate funding in order to pay for drilling operations and the extraction of minerals from the ground. Right now it is estimated that SILA is sitting on an estimated $8.5 billion worth of gold and silver combined on their Mexican and American properties.

This would mean nothing if they did not have sufficient means of pulling it out of the ground. SILA secured a 2-year, $7.5 million equity financing agreement with ZUG Financing Group S.A. in May:

The ZUG group specializes in backing precious metals and mining ventures. This incredible news will keep Gold American busy the next 2 years, in continued development and exploration of their Mexico and Nevada properties. In all, the deal could represent $10.75 million in funding over the next 2 years if the company assumes the full execution of the attached warrants.

SILA’s main property is located in Mexico. The 698.91- acre Guadalupe property in Mexico contains two historically significant mines, and is only about 5 miles north of the Fresnillo Mine, which is the world’s richest underground silver mine. That mine produced over 24,000 ounces of gold in 2009 alone.

Mexico’s mine production of gold increased 10% from 2008 to 2009, and is now the third leading exporter of gold into the US. As exploration and development in Mexico has picked up, SILA has made a timely move to expand their production. The field surveys confirmed the project’s significant potential by returning several high-grade silver results.

SILA’s 2nd acquisition, The Keeno property in Nevada could potentially contain 1.1 million ounces of gold, and 69 million ounces of silver.

It is obvious that The Street is bullish on SILA right now. We have seen tens of millions of investment dollars being thrown at SILA in the open market. We have traders looking to take small profits but it also looks like there is a core of longer term investors waiting on SILA to start the extraction process.

SILA looks great both longer and shorter term right now. Make sure to start your research immediately.
Make sure you visit www.gold-american.com.

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2:20 pm | Vanessa | Tags: , | No Comments »

Will Biotech Heat Up the Penny Stock World?

Biotech Stocks To Buy?


sanofi aventis Will Biotech Heat Up the Penny Stock World?Sanofi-Aventis (NYSE-SNY) now has approval from the board of directors to offer as much as $70 per share for Genzyme (NASDAQ:GENZ).  This equals roughly $18.7 billion for the transaction. Last week we mentioned that the Biotech ETF (NYSE:BBH) was a more conservative way to take advantage of the GENZ takeover rumor.

History tells us that a high profile takeover of a company like GENZ usually spurs interest within the particular sector. This interest also can trickle down from the NYSE to the OTCBB as speculative money is getting freed up with the turn in the markets.

Volatile and super liquid bio-pharma stocks like Rexhan Pharmaceuticals (AMEX:RNN) and Neostem, Inc. (AMEX:NBS) may see increased activity as well. It has been proven that “most” start up biotech stocks don’t work in the long term. Most investors know that if they want a core biotech holding for their portfolio, they will look at companies like Amgen (NASDAQ:AMGN) or they can simply buy a biotech ETF or a sector mutual fund.  Most penny stock and small cap investors are looking for a speculative “home run”.

The potential takeover frenzy in the biotech space may or may not materialize. This is why penny stock investors and traders need to be nimble. In the next few weeks you might see constant PR’s coming from many different biotech penny stocks. Especially since commodity stocks have been beat up recently and many mining penny stocks have lost their luster recently.

The key now is finding these low priced biotech stocks. The best thing to do right now is form a penny stock list that features some different biotech names. Then look for companies with some cash and low burn rates. Then monitor news on large cap biotechs and general sector news as well. Keep in mind that this positive news cycle may not last. If it does……great, but if it doesn’t you have to be prepared to get out of the trade breakeven or at a small loss. So the best way to approach this trend might be as a trader not an investor. Remember there are penny stock flippers out there who trade these types of trends for a living. So be prepared, do your homework and remember to only commit a portion of your liquidity to an idea.

1:45 am | Vanessa | No Comments »

S&P 500: Breakout or Breakdown?


S&P 500 Performance Chart


s-&-p-500-chart
This week, with the exception of US Steel (NYSE:X) and a few others we have not only seen tremendous earnings come out of the large caps but positive guidance as well. This has led us to become focused on the 1113.00 level with the S&P 500. The market closed above this key number on both Monday and Tuesday, but this widely watched level remains in play.

Tuesday’s action was highlighted by positive earnings from Dupont (NYSE:DD) and Lockheed Martin (NYSE:LMT), but those results only propped up the market slightly. Every rally seemed to be met by profit taking.  Commodity stocks were among the weakest. The story may not play out until Friday when the GDP report is released. In the face of these great earnings this rally has seemed to stall out on economic numbers.

The ongoing trend tells us that more positive earnings will be released. But the question is, are the next wave of upside surprises factored in already? Only time will tell. Now how will this market impact the OTCBB ? Common sense says that if Fed Ex (NYSE:FDX) and United Parcel Service (NYSE:UPS) have positive outlooks, we may see a micro cap retailer develop into a hot penny stock. We also could see some bottom fishing in some gold and silver mining penny stocks due to a pullback in metals. The tough part is to decipher which mining names are actual values. We all have seen various penny stock newsletters highlight the next mining home run. So if you act on the commodity pullback be selective and do your homework.  We will have more penny stock ideas on the way soon.

2:11 am | Vanessa | Tags: | No Comments »

Hot Biotech Stocks like (AMEX:RPC) Primed to Rise

Radient Pharmaceuticals Corporation (AMEX:RPC)


rpc penny stock Hot Biotech Stocks like (AMEX:RPC) Primed to RiseWe hope that everyone is enjoying their summer.  We have not come out with a profile in a while because the markets have been turbulent.  We have been seeing them bounce back lately and the Dow is back over 10,500.  This is a crucial point.  There is a lot of indication that big money is coming back into the markets investors are gaining confidence.

We have seen some small cap stocks have a substantial amount of money invested into them over the past few weeks.  This is good news after we saw a huge drop off in the amount of money being invested in the small cap arena.   Most penny stocks were either stagnant or drifting lower on little volume.

We have located an AMEX company that we feel is worth putting on our radar.  RPC is a company that has had a lot of press so far this year.  They company produces and markets cancer testing products.  Back in early April RPC ran from .23 to 2.19 virtually over night.  Millionaires were literally made in a day.

We have seen a drop off in price since then.  It has found a home trading near the 1.00 level.  When a company like RPC makes an 800% plus run like it did, we usually see two events happen that cause the share price to drift lower. (1) People take profits.  If you just made that type of gain on your money you would be crazy not to take some of the winnings off of the table. (2) Shorts will come into the stock because they know that people will be taking profits and it will cause the price to decline.  They take advantage of the declining price and even help it to go lower with the additional selling pressure that is applied when a stock is shorted.

radient pharma stock chart Hot Biotech Stocks like (AMEX:RPC) Primed to Rise


This is why I love RPC.  The stock was mostly accumulated at much higher levels.  There was a period of 3 days back in April in which well over $100 million dollars worth of stock was bought.  This is a huge amount of money for a small cap company like RPC.

Any type of news from the company could allow for a huge gap up.  If you look at the chart you will see that most of the accumulation was done well above these levels.  The break even price for investors is much higher than the current levels.

Make sure that you do your own research on RPC and consult a professional to see if it is a suitable investment for you.  It has been known to be volatile in the past but at the same time it has been a huge home run for speculative investors.

We will keep you updated on RPC and periodically inform you of its progress.  You can start your research at http://finance.yahoo.com/q?s=RPC and check out the company’s new website at http://www.radient-pharma.com/.

11:33 am | Vanessa | Tags: , | No Comments »

Will Fed Ex Deliver for Penny Stocks?

Fed Ex Issues Positive Guidance


fed ex Will Fed Ex Deliver for Penny Stocks?Last Friday was an important day for the stock market. The S&P 500, which happens to be the benchmark index for U.S. equities closed above 1100. This morning we were also met with positive earnings from market bell weather, Fed Ex (NYSE:FDX). More importantly, Fed Ex issued positive guidance. This news has the pundits talking about a rally to 1150. Fed Ex has often been a great indicator of the economy and this may give bulls a little more courage. We may also see some of the money come of the sidelines due to the fear of being under invested.

Now we have seen many false starts on rallies recently, but considering that FDX’s competitor United Parcel Service (NYSE:UPS) also had good numbers, this rally might be for real. As mentioned above, many bulls are calling for 1150 on the S&P, but there is a patch of resistance above in the 1115 area. Skeptics also say we could have a re-tracement to 1040. However, right now it looks as if the sentiment is changing to positive.

How does this impact penny stocks ? We always mention on this blog that it’s easier to find hot penny stocks in bull markets. Just from the mere fact that investors are more willing to speculate when they have gains and feel good about there portfolio in general. The positive sentiment leads other penny stock newsletters to be more bullish as well. The best way to play this out is to look for a close above 1115 on the S&P 500 before getting aggressive. In addition to picking your favorite large caps, compile a penny stock list too. Past history has shown us that a rising tide can lift all boats. Just remember to invest accordingly, limit your losses and always save some liquidity.

2:00 am | Vanessa | Tags: , | No Comments »

Biotechnology Stock Genzymes’ (GENZ) Hostile Takeover

Another Way to Play Genzyme (GENZ)


biotech stocks genzyme genz1 Biotechnology Stock Genzymes (GENZ) Hostile TakeoverBiotech company Genzyme (NASDAQ:GENZ) was the subject of takeover rumors. CNBC’s David Faber broke the story on a possible hostile takeover bid from Sanofi-Aventis (SNY-NYSE). Shares of Genzyme rallied sharply and are up roughly 17% at the time of this entry.

As many of you know, the vast majority of takeover rumors don’t happen. However these rumors offer both traders and investors the opportunity to make fast, short term profits on both the long and short side. Sometimes the best way to play hot stocks like GENZ is through an ETF. For instance,there is a biotech ETF run by Merril Lynch (AMEX:BBH). Shares of BBH represent ownership in several different biotech companies, including GENZ. Genzyme accounts for roughly 7% of BBH’s holdings.

When a stock like GENZ gets hot, volatility increases too. While shares of takeover stocks often offer more liquidity than penny stocks, they are just as risky. If an investor is right, he can attain returns that are only usually seen in hot IPO’s or hot penny stocks. If wrong, 20-30% intraday pullbacks happen frequently. In other words, the wishy-washy trader is usually shaken out.

This is why ETF’s are attractive, and keep in mind this doesn’t only apply to BBH. Buying shares of an ETF in lieu of buying a takeover stock offers less upside, but it also offers a less risky way to trade. The rationale is very simple. Many investors are afraid to jump is a stock that has moved up in a short period of time. Even if they think the equity will continue to move higher. So many times, the investor just passes on the idea and kicks them self later for being on the sideline. Now, by buying the ETF that contains the same equity, they still get to participate. Not fully, but they are represented. This strategy isn’t for everyone, but it decreases risk and small gains add up. So get familiar with a few different ETF’S and their symbols. Remember, when stocks that are in an ETF moves, the ETF sometimes lags behind. The rules of supply and demand still apply, but you have to be quick and prepared. SO add in addition to your large cap and penny stock lists, throw a few ETF’s on your stocks watchlist too.

2:00 am | Vanessa | Tags: , | No Comments »

Can the Droid Carry Motorola?

Motorola Droid


Motorola DroidRecent history has shown us that Motorola (NYSE: MOT) has been a laggard. Bad acquisitions and weak product lines have kept the stock in the single digits since 2008. Now it seems the sentiment is changing. The Schaumberg, Illinois based company is now viewed by some as extremely cheap. Some experts feel Motorola has a breakup/sum of parts value of at least $9. The company also has a whopping $3.60 per share in cash. Not too shabby for an $8 stock. These fundamentals are different from what you normally see in low priced stocks.

Co-CEO Sanjay Jha has made the company relevant again not only to Wall St. , but to smart phone buyers as well. In June for instance, Motorola’s sales were so strong that they couldn’t even meet the demand for the Droid. The success of the cellphone unit will possibly be highlighted even more if Motorola actually goes through with it’s spin off of the cell phone unit, Motorola Mobility. Motorola’s $1.2 billion sale of it’s wireless networking unit to Siemens seems to be the final piece of the breakup puzzle.

There are skeptics too. Many ask whether the Droid can compete with the iPhone or Blackberry. Many still view Motorola as dead money despite the recent developments and the pressure of billionaire investor, Carl Ichan, on management to unlock shareholder value. Ichan currently has a stake of just under 9% in shares of MOT, which are currently at a loss similar to a penny stock trade gone bad. Certainly not something you would expect out of one of the greatest stake buyers in Wall St. history.

Now is the time to watch the news closely on MOT. The anticipation of the tax free spinoff to shareholders may drive buyers in before the record date. Also watch for asset sales and Droid sales relative to the iPhone. These are all potential catalysts. While buying shares of MOT is less risky than buying shares in hot penny stocks, trading rules still apply. Always use a stop loss, scale out of the trade if you are profitable and always save some liquidity for other ideas.

12:23 pm | Vanessa | Tags: , | 1 Comment »

Green Dot IPO Preview

Green Dot IPO News

Green Dot CorpLast week we saw two Smart Technologies (NASDAQ:SMT) and Qlik Technologies (NASDAQ:QLIK) trade at first day premiums. While QLIK held it’s gain and traded even higher during the next trading session, SMT plummeted and hasn’t traded back to it’s issue price of $17. These recent results are just another example of how unpredictable the IPO listings have been lately. Some IPO investors will sell a new issue once it breaks it’s issue price, figuring the stock is broken on a short term basis. These sell orders often have a ripple effect and trigger stop loss orders which often bring a stock down to the point where it becomes oversold. Other IPO investors will step in and buy shares when this happens. They are looking for a quick retracement to the issue price. In some ways the tape action is similar to trading hot penny stocks. Many penny stocks that have been beaten up are often flipped by traders who forsake the potential of huge gains for frequent, fast, small profits. It’s a game that’s generally played by experienced investors and may be played again this week with Green Dot (NASDAQ:GDOT).

Green Dot is based in Monrovia, California and was founded in 1999. The company is a provider of prepaid MasterCard and Visa debit cards. As of the entry there is a lot of interest in this IPO. The offering size has been increased and most IPO services are anticipating a premium of 1-2 points. Green Dot also has corporate partnerships with companies like Walmart and Kmart. Walmart also happens to own 2 million shares of GDOT. Another big investor in Green Dot is Sequioa Capital which owns a 31.9% stake.

The fundamentals of Green Dot are better than most IPO’s. As of 3/31/2010, they earned $4.4 million on $92.8 in revenues. Now here’s the unpredictable part. The Green Dot IPO is a private equity deal and the shares offered are all from selling shareholders. Recently the street has not been too kind to these offerings. However, sentiment can change. This is just another example of why investors need to do research. The selling shareholders might be a non-event, but it doesn’t hurt to have this knowledge as an arrow in your quiver. Like penny stocks, finding information on IPO’s is sometimes difficult. So try to find out what you can before you invest or trade. It could be the difference between a massive gain or a loss.

1:31 pm | Vanessa | Tags: , | No Comments »

Is Goldman Sachs too Cheap?

Goldman Sachs News


Goldman SachsGoldman Sachs (NYSE:GS) reports earning on Tuesday, which always brings substantial interest into the large cap financial name. To many, it seems that the sentiment surrounding GS has changed to mildy positive, while the sentiment of its peer Bank of America (NYSE: BAC) hasnt been as strong. The company was just removed from the GS conviction buy list.

Goldman Sachs has rallied from a bottom of 129.50 mainly on it’s $550 million civil fraud settlement and it’s price relative to it’s $128.33 book value. Now it seems like support could be there at the 50 DMA of 137.81.

However when earnings come, throw all of recent press releases out the window. Shares of GS have always remained favorites (Both long and short) of hedge funds and day traders. These investors have made GS especially volatile and that volatility should increase this week.

The question is which way does the stock go? Unlike penny stocks, large caps like GS are much more sensitive to earnings. As we all know many hot penny stocks have provided huge returns with extremely negative earnings. That won’t be the case with shares of GS. Many are predicting that the recent settlement will have minimal impact on earnings, and the street will focus on core banking.

No matter what the result is, Tuesday’s trading should be volatile. So if you are not long yet and are interested, pick a price. Some are saying buyers will come in at the $142 level, but that remains to be seen. Once again, if you happen to go long, use a stop loss. Trading opportunities like this happen frequently, so always save some liquidity for future trades. This is just another example of why investors need to be aware and form large cap and penny stocks lists. Being prepared is part of the battle in trying to book massive gains.

10:09 am | Vanessa | Tags: | No Comments »
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