Chart Forecasts: CSLI, VKNG, DPDW

The broad market may be up today, but more than a handful of the smaller names appear to be in trouble. Viking Systems, Inc. (OTC:VKNG), Critical Solutions Inc. (PINK:CSLI), and Deep Down, Inc. (OTC:DPDW) are on our trading radar. One's bullish, one's bearish, and one's deceptive.

I mentioned Deep Down, Inc. (OTC:DPDW) a few weeks ago as a bullish opportunity - you just needed to wait for a pullback. Since then, we've seen the stock peel back to more reasonable levels.

It was on October 20th we first pointed out Deep Down shares were staging an attack on resistance at $0.194. In the meantime, DPDW did indeed break above that mark, but fell back under it a few days later. It was simply too much, too fast.

Now, however, Deep Down is settled in, and appears ready to make higher highs at a healthier pace (the problem last time around). The big clue though, is volume... we've seen strong accumulation days even during the pullback, and we've yet to see DPDW show us any distribution days.


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At first glance Viking Systems, Inc. (OTC:VKNG) may look like it's in a strong uptrend. A longer look, however, paints a different picture.

Kudos to Viking Systems shares for making big gains over the last two and a half weeks, but today may be the beginning the pivot point for the rally. Today's bar is called a doji, where the open and close are basically the same, and bar is tall from top to bottom. In the case of VKNG, the doji occurred after (and above) a runup... another clue. The fact that volume is spiking is yet another pivot sign.

To make a long story short, I'm looking for Viking Systems shares to head lower from here. I'd recommend doing what most of the pros are doing at this point, and take profits. I'm not sure about a landing spot yet, but VKNG has flown high enough to set up a decent pullback - bigger than you'd want to ride out.

Critical Solutions Inc. (PINK:CSLI) is another one of those stocks that requires a closer inspection. The high volume gains looks bullish at first, but when you stop and think about it, it doesn't quite jive.

Yes, today's 90% gain on 32 million shares (versus the average of 4 million) is huge for CSLI. But, considering that's six times as much volume as we've ever seen on any day from Critical Solutions, a 90% move actually isn't that big for a stock priced under one cent.

I'll keep my eye on the chart, but if you're interested in Critical Solutions Inc. because of today's action, the lack of traction should concern you greatly. CSLI was fading as the day come to a close.... not a good sign.

If you'd like to know of any changes in our opinion of VKNG, CSLI, and DPDW (or if we officially recommend them as trades), be sure to sign up for our free newsletter today. It's delivered weekly.