I grabbed this before its run up started on Friday. I did not sell for a few reasons:
1. Breakout volume events often start a new trend - it is highly possible that we are looking at a 3 day run rolling into a coiled spring/pennant afterwards, provided that they can keep nice releases coming over time.
2. The majority of buying occurred at .08-.10, .12-.14 and .15-.17 (exhaustion). Closing at .11 is above the first accumulation mark and will begin the reaccumulation phase tomorrow morning.
3. At 1PM this stock was published to subscribers of otcstockexchange.com and resulted in the .15-.17 push. Some of these investors fled after the dip but subscribers often hold longer than most. These shares are still unavailable. They are looking for a recovery point to get out.
4. Other stock pushers have yet to pick up on the move. Look for other subscriber services to jump on the bandwagon and push the stock price higher.
5. Activity died down at the end of the day but price held and went up slightly. Obviously a few people saw this as a good entry point for a morning gap, which is likely.
6. You can clearly see insider buying in the days before the release. Those investors have probably sold their profits. However, they account for less than 1/10th of all volume that occurred on Friday. This means the opportunity has surpassed their expectations. They may regret their mistake of selling and rush back in with the next flood of buyers. Some of them may even still be holding if they are aware of further releases forthcoming.
If it gaps tomorrow in order to sustain itself it will need continued coverage by other sub services and/or the PR department of SFXC. I did not have a chance to call them. However I think the key element is the breakout volume which is 10x normal daily. The price may fluctuate a bit but it will probably not break the original .08-.10 entry run point anytime soon.
If you're uncertain about the potential move, watch for a good dip entry. This can be very difficult to find without Level II. The holders in the best position to gain from this pick are those who have the lowest common share price. Its not likely that many others who grabbed this at .065 are still around besides myself, but those who are expect a higher run up than .18. It's a difficult point to hit but if volume continues, more stock pushers will get on the bandwagon feeding their subscriber frenzy. Tuesday mornings after a holiday can prove to be very charged times for prospectors.
If you can find similar charts that break from absolutely nothing/weak channelling into a new trend with heavy volume you will see that they often run for 2-3 days and then die off before moving again. Sometimes the best entry if you missed the original can be after the big push has completed and the stock finds its new neutral zone which can be as low as the first breakpoint, in this case .10.
Examine Friday's pattern and expect a similar series of buys and sells to erupt Tuesday. This will help with exit and entry points.
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