Back on September 26th I told you guys that timing was going to become the new focal point of the newsletter. It didn't matter if we were talking about the overall market, a sector, or individual stocks ... pinpointing the tops and bottoms for anything is half the trading battle, so we were going to do more of it for you.
And we have. Today's newsletter, however, is going to take us from waist-deep in that mission to neck-deep. Hope you like it.
Oh, and by the way, these are all strictly my personal opinions based on too many years of good and bad decisions. There's always a smidgen of a chance I could be wrong, though I know that's hard for some of you to believe... right?
Anyway, here we go.
This is Where the TAXI Stops
Though it's been less than a month since I introduced you to Medallion Financial Corp. (TAXI), I think this trading idea has used up all the potential I saw back on October 10th when it was trading at $9.90. The current price of $11.65 translates into a gain of 17.6%, though at one point on Monday this thing was as high as $12.59. That would be a 27% gain for any of this name you still owned, and I really hope it was some of you guys taking advantage of the strong open.
Just as a reminder, I also advocated locking in some profits on half of any of this idea back on October 31st, when it was trading at $11.89. It was a strategic decision for an overbought stock, and in retrospect was a good one; it locked in an 18% gain on a portion of the trade, but gave you a shot at more upside if it was in the cards. As it turns out, it wasn't in the cards, but we're no worse off now.
Either way, check out what's happened with Medallion Financial over the past three trading days - three consecutive lower closes. What bothers me more than that though is how we've also seen (assuming today's bar doesn't change much) three closes under the open. This is a hint that the prior buyers are using this strength as an exit point; volume hasn't been light behind the selling either. So, let's get out while the gettin's good.
I'm now officially taking TAXI off my list of names that I like, sensing the best is over for now. I don't plan on updating it again unless I decide to pour back into it later.
Sagebrush Gold (SAGE) Over the Hump
Bryan Murphy has been doing a great job of following the Sagebrush Gold saga, and deserves the credit for being the first to point out on November 2nd what I'm going to show you today... SAGE is over a big technical hurdle that may mean more upside is ready to unfold.
Simply put, this chart is finally over its ceiling at $0.62. After the early October pullback to $0.43, we saw several brushes with the $0.62 level, but none of them could actually pull this junior gold mining stock above that resistance. The stock continued to make higher lows, however, and finally was rewarded with a breakout move today. SAGE is at $0.69, and it's made the move on good volume.
Now, I'm not telling you what to do - I'm only telling you what I see. But, I'll add how the big plunge from October was suspicious to begin with, and more often than not those errant moves are eventually fixed. The fact that the stock's starting to move higher on massive volume is another important clue.
More Timing Stuff From the Site
While TAXI and SAGE were the two biggest timing ideas I had on my plate to share with you, a bunch of the regular contributors at the website have also been putting up some timely and actionable commentary. Here's a quick rundown of the biggest successes and most compelling ideas (from where I sit anyway).
- What is it about Mistral Ventures Inc. (MILV) that scares Bryan Murphy so much? With just a quick glance this thing looks like it's a rocket ship. There's something not quite right though, and it leaves him wondering if this is going to be a repeat of the RAYS demise from Monday. [Update: MILV is even more over-extended now than it was when Murphy posted his article. Yet, the missing ingredient from then is still missing.]
- After a very long dry spell, these small cap oil drillers are rallying with a vengeance and look poised to make up for lost time and lost ground. Dennis Askew has the scoop on the names rebounding best with crude oil prices.
- Once again Jonathan Yates has beaten the mainstream media to the punch, noting Eastman Kodak (EK) was teetering on the verge of bankruptcy back on October 25th. Reuters didn't get around to coming to the same conclusion until late last week. We've said it before and we'll say it again... our guys have their finger on the pulse of the market way before most everyone else starts to notice these big trends.
- Despite today's 17% gain, Forbes still says this telco name is worth four times what it's currently trading at.... at least to a suitor. Yes, M&A speculation has taken a back seat to IPO's of late, but Groupon's questionable merits may mean public offerings are no longer the 'in' thing; mergers and buyouts could be coming back into vogue. If that's the case, buyout speculators may want to start with this one.
That's it for today, but we do want to give you a heads up on something coming this weekend... a new Featured Stock.
We'll add some hints about the company as the time approaches. For now we'll just mention the underlying trend that's going to make this idea so compelling has already been mentioned above.