One New Very Speculative CANSLIM Long Position For Tuesday’s Stock Market Session

February 15, 2008

My scans were void of anything of real quality in the chart department, but in the IPO scan that I keep of recent IPO’s that do not have a 200 DMA (they don’t show up on my screens, since the don’t have a 200 DMA at first) there was one stock. That stock happens to be in the HOT Energy-Other sector, is over $10 a share, has strong fundamentals that have slowed in EPS but are expected to pick back up this year and next, and is the only stock worth going long tonight based off chart patterns. Newbies should probably keep their powder dry on this one since it is so speculative and has not traded long enough to have a solid and safe history behind it.

new long position: GU

GU is breaking out of a V-shaped cup with handle pattern, on strong volume. GU is a very new IPO so there is not a lot of price and volume history with this stock but after the 2/4 breakout gap on very strong volume the stock set up in a nice sideways consolidation pattern on quiet volume with BOP staying green the entire time it based. Today’s move with a small surge in volume with BOP still green gives this chart a very bullish appearance. TSV is leading the way higher in the middle indicator. This is not a good long for newbies due to the lack of price/volume history. But for experienced investors, it is worth a poke, due to the chart pattern and it being an environmental and China play. Cut your loss with a close below the 10.58 level, if the stock does not move higher immediately.