Wind energy is so hot right now. China is also hot right now. And let’s not forget stocks with low floats/low marketcaps that are apparently profitable and definitely breaking out ON RECORD VOLUME are pretty much the only surefire ticket to predicting ridiculously strong price surges. Put all these qualities together and that’s what APWR is right now.
I’m not gonna waste your time or mine by going into all the boring numbers, just know they’re huge, think potential of a billion in sales (not just potential, they’ve got LOIs, or letters of interest, woooo hooo), a low PE ratio—who knows and who cares the specifics—stocks like this move based on hype and possibilities, not exact numbers, and most importantly, it traded nearly half its 2.2 million float on Friday while breaking out to an all-time high after a solid 3-month base and has been embraced by the smallcap gurus at TheLion.com (ensuring it’s on plenty of day traders’ radar screens), I’m just gonna paint you a portrait of how hype works to the advantage of longs here.
Smallcap momentum trading is about finding the most hypeable stocks. Yes, this stock is $3+ past the original breakout point, yes there were sellers—and short sellers—on Friday afternoon (premature fools), trading volume could dry up quickly (considering the stock has never been in play before), but not on Monday—THIS STOCK IS A HYPSTER’S WET DREAM. And that’s why I bought Friday afternoon.If all goes as these kinds of plays usually go, I expect a strong morning surge on hundreds of thousands shares traded and then we gotta see how strong the volume and the price pattern can remain. 2.2 million float, remember it, that’s what matters most, if we can get millions interested in buying, let the short sellers try to hold this sucker down, (supply and demand you bastards, supply and demand!) No doubt somebody will take this post and spam it everywhere and they rightfully should—longs should be proud that they understand this game enough to already be in this play. There’s already plenty of comparisons to EFUT (another low float, low PE, profitable Chinese hype play that famously went from $14 to $50 within 4 days just over 1 year ago) and for good reason. I played EFUT just as I’m playing APWR because the intraday price action is scary similar. $50, sure, it’s possible, but not probable—all I want is $20 though and that’s much more probable than $15.
These low float hype plays (I know I’m repeating myself, but it’s the most important element here) are NOT the kinds of stocks you ever want to short until the price pattern is decidedly bearish (no all-time breakouts, LOL!)—trust me, I’ve tried playing them from that angle too and they tend to go further than anyone thinks possible—but some short sellers haven’t learned that lesson yet (perhaps they should watch my instructional DVD) and their premature entries are what makes these stocks so much fun for longs, for their near-inevitable panic creates short squeezes, aka the only way stocks can spike $1, $2, $5 within a few minutes/hours.
So do your DD, whatever the hell that means—you can’t trust companies, especially Chinese companies, you can’t trust day traders who already bought (me, Superman on TheLion.com and others who will spam this (thanks in advance!)) and you can’t trust this crappy bear market not to intrude on the beauty that are these hype plays. All you can trust is that successful trading is all about entering trades where there’s an overwhemlming number of variables aligned in your favor, which in this case points to being long APWR to da moon! (or whenever the volume/hype wears off)
Disclosure: Long APWR, long the smallcap hype game, long introducing this to the world without all the typical BS through my blog, book and DVD
Posted in Breakouts, Patterns To Buy