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Rhee

07/14/14 5:45 PM

#22514 RE: ospreyeye #22442

Mini-analysis of the psychology here...

Thanks my friend. To your question, the R/S actually doesn't affect the technicals at all. The scale of the chart will simply change. And say a .04 PPS simply becomes a 2.00 PPS now - they become the same thing. And everyone's shares in their account will be adjusted to reflect fewer shares at a higher PPS for the same investment, albeit with a bit of a shave due to the sell-off.

Regarding what the stock does, it tends to be twofold. But this I am not sure of, as every company behaves differently to a R/S. First, in the immediate-term we would expect a serious haircut to the stock - which is in full swing in AH. Today you'll note intraday I calculated the stock should hit around .048 either today or tomorrow. Funny how those technicals are reached regardless of news. Below .05, the next support level is .04. So it is a matter of seeing what level ultimately holds in the immediate-term, over the few days.

(See today's midday target calculation here: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=104280963. While I mentioned sometimes the close can be bought, today in a later post I cautioned against it. http://investorshub.advfn.com/boards/read_msg.aspx?message_id=104290609)

Second, once the stock finishes its R/S, and especially if the stock has sold off really hard, the next wave of psychology kicks in. If the stock has really big volume to the downside, at some point buyers come back in, and perhaps even hard. This is because psychologically the stock is above $1 again (even if it is at .02 on the old scale). More importantly, it means delisting is less likely in the near-term as NEWL will have satisfied the listing requirements. With greater certainty, the stock can retrace up again for a bit. Timing this is not necessarily easy. Better to wait for a moving average to be crossed, or some positive PR.

I still feel terrible for anyone trapped here. It is the name of this game - which is why I keep posting the technicals as sign-posts. A really tough stock to play, least of which because it is addictive.