10:45am
Good morning readers. We saw a positive open today and now the market has turned flat after President Obama’s health care speech. The dollar is down slightly which is giving some strength to the market but we are still down on the day as I’m writing this. The S&P 500, while down slightly, is still over 1105 which is a very good sign for the bulls. Banks have shown some strength but we don’t really have any true leadership today which won’t help the bulls cause.
I’m finding it tough to locate good entry points after the run-up we’ve had so that could pose a problem for the bulls continuing this run. However, last year saw many V-shaped bounces on low volume so that could be the remedy the bulls seek and need. I’m more optimistic about the bulls chances now that they have proven their staying-power, but I still can’t shake the belief that the bears will keep pressure on us at these levels. It seems we could have more downside risk at the moment than upside.
I’m not doing a whole lot today in light of this. GoIP Global (GOIG) released a PR statement today that touched upon two very positive and key points. They say the website launched last week has had an “overwhelming” response which is not a shock as this service should be a household name one day. They also touched upon another important topic in regards to their standing on the pink sheets. GOIG stated they have done their part to remove the warning on the pink sheets which has caused some frustration for shareholders but has done nothing to change my belief in this stock. They anticipate that warning to be removed shortly and that should help remove any doubts from the naysayers. GOIG continues to do the right things and I fully expect that trend to continue. The PR can be seen here.
We saw a small move up after the PR was released and while I felt the overall sentiment was positive, the news was still lacking and the shares are reflecting this so far today. Shareholders wanted to see something more and I don’t blame them. These are very positive statements made however we still want the Verizon (VZ) news and official launch date. Patience should payoff though. I’ve also seen some excitement lately that individuals with VZ phones can now text the Go800 service and receive a response similar to the phones with AT&T, Sprint, and T-Mobile. This is calming the ridiculous fears which VZ was going to walk away from GOIG. VZ wouldn’t benefit to do so in any way possible. I expect to see a PR statement by the end of the week stating that VZ is on board and hopefully the launch date is announced as well. I expect the combination of VZ and the launch date should refuel the bulls for a move up and will look to shave some off into that strength as we could see another dip between that news and the official launch date if it’s at least a few weeks apart.
In another holding of mine, Sirius XM (SIRI) is up slightly around resistance levels which I stated in my earnings preview. If we can break this resistance, we could see some shares traded in the $1.20’s and I might take some more off the table if that takes place prior to earnings. While I expect positive earnings, I think we have already priced in the expected good news with more room to disappoint at this moment. I’ll look to rebuild my position on a pullback after earnings, if my thesis is still intact, which I feel it should be.
In other news, Genius Products (GNPR) is finally revamping their website, and that is much needed to say the least. You can expect more updates from me on GNPR as we inch closer to the launch of the much anticipated music game Scratch the Ultimate DJ. However, if you believe in the stock, now is the time to buy. The closer we get to the launch date, the higher the PPS will move as the supply is low (under 140k O/S) but the demand will continue to grow. I’m going to continue to add when I can to my already large position. I expect to turn from a buyer to a seller when we move closer to the launch date and lock in some profits when I can while letting the rest ride. GNPR is one of my larger positions at the moment, so I’ll want to right-size the position when the PPS is favorable to do so.
I recently took some JP-Morgan Chase (JPM) off the table as the run-up was nice recently but I feel any moves from here will be a bit more of a struggle. I’m still long JPM, but I want to diversify and possibly add another large cap stock to my portfolio. I tend to speak a lot about smaller cap stocks as of late, and rightfully so as they are more exciting to discuss, but I also make sure to keep large cap stocks in my portfolio for diversification reasons.
All in all, today is a flat day so far and I don’t want to force any moves just to stay awake. It sure is tempting though. I’ll continue to stay patient and makes moves when they are presented. Thanks for reading Kudrna’s Stock Market Blog. Good luck out there.
Mike
At the time of publication, Mike was Long GOIG, VZ, GNPR, JPM, and SIRI but positions can change at any time.
