I hope all of you are watching our small cap pick Spicy Pickle’s (SPKL) chart right now. If you are, then you may have already noticed some clues that a bottom is being tested. And as I said in a couple of blog entries and newsletters, I’d look to buy on a dip when the dip looked done.

Well, if you’re also looking to step in (or back in) before the next wave of buying, I suggest you get ready….I think it’s going to be soon.

Above all else, we’ve now seen a full 61.8% retracement from the highs of $2.02, starting back with the low of 56 cents (from September 21st, when this micro cap name really started to trade well, and with some volume).

More than that, look what happened once that $1.12 level was reached today. SPKL reversed course and started trading back up at the higher end of its range. Upside reversal? Sure looks like it could be.

By the way (as I said repeatedly at the time) I think the right thing to do was take profits about three weeks ago - or sooner - since the chart was starting to look a little extended then. Why take profits on a good micro cap stock in a long-term uptrend? Take a look at the last three weeks - that’s why. If I can make money on two rallies instead of one, why wouldn’t I?

If you didn’t get out, I think you may be off the hook within the next few days. However, I hope you don’t forget that short-term pullback the next time we get over-extended. Remember, the underlying story is driving the stock higher for the right reasons. The hype is pushing it up and down in the meantime. There’s nothing wrong with playing one against the other.

Anyway, I’m thinking round 2 of a SPKL buying spree is just around the corner. Stay tuned. 

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