12:45pm
Good afternoon readers. I’m making some moves today in smaller caps and wanted to update my readers on my strategies. GoIP Global (GOIG) has continued the breakout from last week and it’s a reminder to me of what happened in early February. We rode up to new highs for a few days, higher than some expected. At that time, volume dried up at the high levels because the risk of buying too high greatly increased. The PPS came down sharply after that, which created panic sales as some tried to lock in profits. I believe we could be seeing the same thing sometime this week unless we get some major media attention to attract many more buyers, which will continue this string of high volume days. As I’ve discussed, a significant benefit to GOIG is that it is a “stealth” stock with little attention at the moment. When the rest of the world hears about this concept, we can expect significantly more volume and buys, assuming nothing negative happens with our service launch and demand. As you know, I’m betting on great things.
Since I have a significant position already, this allows me to make trades now without the fear of missing out if we make a huge jump. I’m currently running trades and locking in some small but frequent profits in GOIG which add up over time. This is a strategy I like to utilize when I’m a believer in a stock long term yet don’t want to just buy and hold. Realized profits are very important to me. They allow me to accumulate profits to the point I’m playing with the houses money therefore less risk involved. Just because your trading platform shows you are up a significant percentage doesn’t mean you actually have any profits. When you actually sell at those prices, you finally have realized profits.
Look for that panic sell to happen this week if we don’t get some major news to sustain this move up. I’m ready to accumulate many more shares for long term if we do indeed dip. Either way, I’m prepared for a move in any direction as you should be to.
I’m also utilizing the same strategy with Sirius XM (SIRI) but I’ve been doing this with SIRI for much longer. I still believe in SIRI long term so I don’t have a reason to cash out my position entirely however I know how the stock trades because I’ve become very familiar with it over time. Now I can run trades to make more profits while still keeping a core position to gain profits on any significant moves up.
Speaking of SIRI, I am accumulating more today under $1 and feel today could be the day we don’t close over $1 after we were hit with a downgrade. This would put some short term pressure on the stock as some panic sellers come in after we worked so hard to keep it over $1 for the ten days required. Even so, I’ll continue to accumulate more for the push back over $1 because it will happen again. The fundamentals are strong enough to support the new price levels and the downgrade does nothing to change my belief. I originally predicted we’d have more of this type of pressure when we first moved over $1, I was wrong and we swiftly moved over the $1.10 resistance instead to which I sold some shares into. My thesis has not changed and if anything, it is only stronger now after they have released earnings. Therefore, I’m using this opportunity to buy more shares at favorable prices and will trim into strength over $1. If we can recover and close over $1 today, I’ll be even more bullish. We’ll see what the final hour has in store for us but don’t be surprised if we finally break our streak today. If you haven’t already, read my Earnings Update.
Outside of that, I’m running some smaller trades and trimming some larger caps into strength. I’m more bullish on the general market than I’ve been previously. The bulls have earned that right but I can’t seem to shake the belief that the more negative news we continue to accumulate will finally be the breaking point for the bulls. However, we are trending like last year with lower volume yet green days. Keep in mind, we are also seeing strength from the end of/beginning of the month. Thanks for reading Kudrna’s Stock Market Blog. Good luck out there.
Mike
At the time of publication, Kudrna was Long GOIG and SIRI but positions can change at any time.
