Worlds Inc (WDDD)

[Nolerman]

Ok...sorry for this in advance as it is a long read, but the following is an analysis from Newbie on VRNG Free Forum (coolerheadsprevail here on Ihub). This is as good a prediction (well explained and backed by numbers and historical patterns) as I've seen yet. Definitely worth a read.



~Also, keep in mind that due to the low market cap, the volume can be a deceptive metric of investor interest -- as well as a deceptive metric of how much influence just a small number of deep pocketed retail investors could potentially wield.

Similar to a point I alluded to in a prior post long ago in this thread, think about the fact that both VRNG and WDDD currently have about 85M shares O/S (more or less). But VRNG's sp is 8x what WDDD's sp is. This means that on a weighted-average basis, WDDD really has the equivalent of only 10.6M shares O/S due to the increased buying power of the same dollar being invested.

Look at it this way: Investors don't invest based upon the number of shares they want. They invest based upon the amount of $$$ they are willing to plunk down on any particular stock. So if an investor is mulling over whether to invest $10k in either VRNG or WDDD, he will buy either 3,125 shares of VRNG or 25,000 shares of WDDD. At this type of scale, which is common for stinky pinkies like WDDD, it will not take too much retail interest to begin moving the sp.
This actually reminds me of the period when the sp was stagnating in the low-mid teens. Volume was non-existent and there were anecdotal stories of people wanting to sell but finding no buyers.

This does not surprise me as those who own are waiting for the next leg up and those who are on the sidelines are waiting for a sign that the next leg up is forthcoming so as to not have funds tied up in a stagnant stock.

My theory (again, no way to prove it) is that based on how quickly the sp jumped once it hit .26, that this triggered a buying and selling cycle that fed upon itself (i.e. "the run" that took us to the .40 level we are at now), with many of the same shares churning over and over again -- without truly putting as much of a dent into the float as many believe that it did.

My belief is that it is not coincidental that the runup began when the sp began kissing the .26 mark -- note that this .26 level represented a double for many "older" investors who had gotten in when the sp spent a longtime gyrating between .13-.15. It is no secret that many investors/traders de-risk when they double and sell. Buyers think a runup is coming and purchase these shares. And at each .01-.02 interval there is another wave of investors who have attained "double" status and fuel this cycle again, with more buyers jumping in to what they see as a run-up gaining steam.

This cycle repeats itself until it runs out of steam in the low-to-mid .40's (with high water mark of .49). Again, I do not believe it to be coincidence that the run ran out of gas at this resistance level as it represents a double from the most recent sp levels where it spent a lot of time consolidating prior to the run-up, which was between .22-.25. A lot of sales occurred between the .44 and .49 levels, which I believe represented a lot of the shares that had been acquired in this .22-.25 range before the runup kicked in. And remember, it did not spend much time around .24-.25 at all before it ranup -- which fits in with why we did not stick around the .49 level long as there simply were not that many of these .24-.25 shares that were up for sale.

Now that this "first generation" of shares have cycled thru, it seems that WDDD is building another base here at .40 where the current generation of shareholders are waiting for it to breakthru .50, which is where I would not be surprised to see the next leg of the runup occur. But WDDD needs to see a catalyst -- be it actual news, exaggeration of the potential impact of news, an outright believable rumor, a full frontal assault by SA writers, or simply the expected greed of speculators rushing in as the Markman date draws ever closer -- in order to get it up to. 50 first.

I believe that once WDDD hits .50, we will begin seeing this cycle of selling/buying due to the "double-then-derisk" phenomenon play out again, and if my theory is correct, it should -- barring other legitimate news or other catalysts -- run its course at close to 1.00 before retracing back to around .80 in order to re-group again.

So a rare prediction from me here, as the support and resistance levels, the levels where consolidation appears to be taking place, etc, just seem to be screaming this trend out to me -- but then again, the screaming could just be those voices that have been coming back ever since I stopped taking my meds...

Read more: http://vringo.freeforums.net/index.cgi?board=other&action=display&thread=1146&page=27#ixzz2Q4DRIfAv