After last weeks scan for Thursday and Friday provided us with some pretty good results I’ve added some new stocks to watch for Monday. Although many more came about in live chat, I’ve focused on a few stocks that have had rather tremendous moves towards the upside and are approach 100% + moves over the past months. At these levels a short position for the quick trade seems more reliable than jumping in as a long.

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From the last blog EBS, SMSI, GNVC are all similar patterns that are beginning to get a bit top heavy.

GNVC I am watching like a hawk! This continues to become more and more of an over extended move. No matter how attractive the move may look as of its prior close… all nice moves don’t necessarily come to an end… but they do have to take a break… Once the support (longs) decides they’ve done enough and begin taking on too much inventory (stock) this will sharply correct towards the sub 2 dollar mark. This likes to squeeze in the morning and sell off during the day.
How will I play this? I will sit on my hands and watch the daily squeeze (which normally happens 15 minutes after open the past 2 days) and decide what to do. If $2.20 is tested but cannot break, I will take on a short position. If it does, I will wait and let it test $2.30. At $2.30 there will be two plays, the first it breaks and squeezes much higher (which will provide a great short on the spike at a 20 to 30 cent premium to it’s current levels), or it triple tops and screams “SHORT ME” before it takes out Friday’s lows and breaks through $2.00.

DMLP

Dorchester Minerals is on a tear lately taking out its past resistance around the $22 mark. I’m looking for this to test $24 dollars before taking a short position. $24 dollars is the next physiological break for a lot of traders, whether it turns into a short squeeze from there we will only find out with the results of the test. If it does I’d sit back and watch for weakness, there should be a nice 50 cents to $1.00 retrace after the recent move up.

IVAN
Surprisingly Ivanhoe Energy has held it’s recent gains. The 50 and 200 day moving averages will be crossing in the next week turning into what technical traders may refer to as a ‘technical breakout’ on the ‘golden cross’ (when a 200 and 50 day moving average cross). If IVAN doesn’t break $2.10 it’s not really worth the space on your radar screen… but if it does, keep your eyes peeled! Ivanhoe normally carries many surprises as it carries a large base of haters (shorts) which has led to many unexpected jumps in the past, breaking through resistance levels (like $2.10) as if they weren’t even there. One thing that can be expected is a rather quick correction after the squeeze (as we’ve seen in the past). If it breaks $2.10 I am watching for a 30 to 40 cent spike before shorting.

OSCI
Oscient Pharmaceuticals made my scan again. Watching for this one to top off - it has recently broken the 200 day moving average of $2.34. This it trending towards $3.00 very thinly traded. I’d like to see it spike a bit more before shorting it since some new support may form in the $2.30-$2.34 range (last high and 200 day moving average).

PODD
Insulet Corp approaching the 200 day MA at $19.59. I’m looking for a rest test of $19, if unable to break we should see a near dollar or more correction towards the 50 day moving average of $16.30. I’d looking for the move towards $19 right out of open, if it doesn’t make it keep it on radar for signs of weakness.

IOMI
Similar feeling that I had on OSCI. Watching this one to squeeze a bit higher … but overall a rather over extended move. This could see a correction towards $2.00, but may consolidate in the $2.30 range as it did at 1.60. If it does, keep it on radar for weakness. Keep in mind it’s up 300% since mid February. if $2.20 support falls it has two gaps to fill both which happen to be under $2.00.

FCFS
First Cash Financial Services has been slowly moving towards $14.00. FCFS has filled the gap which took place mid January when it opened $4.00 dollars lower and sold off more than $6. This may continue to squeeze towards the $14.50 area where it’s last high was before selling off. I’d watch for the squeeze towards $14 but be eager to short if it can’t break the $13.75 mark. As soon as this retest $13 I wouldn’t be surprised to see a few stop orders triggered giving a quick cover in the $12.25-$12.50 range if not lower…

FAST
Sure … they beat estimates but that doesn’t mean much in this market. RIMM crushed wall street expectations and it turns out it was already priced in, actually … overly priced. This is sitting just under $50.00, I’d watch for the $50 break followed by a quick squeeze towards the $51 mark out of open if any squeeze takes place at all…. this is the move I’d want to short on. It’s had a low of $32 mid January, a low of $37.57 mid March, and now faced with selling pressure on Friday looks rather bearish for the coming weeks.

RECAP
Last weeks blog entry still has many great stocks in play. BIDZ turned out as expected with a big drop on Friday closing just under $9.00. This still has a about 50 cents or so more downside before any technical bounce off the 50 day moving average. IOMI needs to be watched $2.50 is key, if it doesn’t break $2.00 will come rather quickly.