A new medical stock to go long and a healthcare stock I am already long are both good for a small purchase. But there is no way with GXDX just bouncing off of a very short term support after such a climb off the lows and a stock up over 10% and nearly 13% away from the 50 DMA can be highly recommended by me. GXDX makes a great starter position as it is a great medical stock with amazing growth. However, the bounce is early in the base and the risk for failure is much higher than if the base was five to seven weeks long. If the base would be longer and the bounce would be coming right off the 50 DMA with the BOP still max green you better believe that would match up with a “past big winners” setup. But it isn’t so I must exercise caution. You saw MR, STJ, and AMED. If you think GXDX is invincible with the strong fundamentals just because it is a new stock…remember MR. XSI is very pretty but it is not beautiful and does not trade enough shares and is too far from the 50 day moving average for me to get very excited about. It is very pretty and looks great in this ugly market. But buying it after such a move is too risky with volume so low. One very big sell order could knock this stock 20% or more. So if you do go long set yourself up limits around the $5.50 to $6.15 area. In this market how, if you are a newbie, I wouldn’t buy either one. Neither one is “perfect.”
new Featured long position: GXDX
GXDX is bouncing off support right after a powerful breakout in early August, on very strong volume. Cut your final loss with a close below the 34.36 level, if the stock does not move higher immediately.
adding to existing speculative Featured long position: XSI
XSI is breaking out of an ascending base pattern and bouncing off support near the 50 day moving average, on very strong volume. Cut your final loss with a close below the 50 day moving average, if the stock does not move higher immediately.
I am considering an investment in Can Slim, but would like to know if your strategy of selectively purchasing the Can Slim portfolio appears promising? Obviously, the purchase of in-the-money calls could be employed to maximize returns through the leverage of options. Have you been successful in using your strategy?
Thank you,
RM