eCrypt Technologies (ECRY) Prevents Hackers From Invading Your Privacy And Stealing Your Identity!

Good Morning!

Cyber crime is a profitable business. So profitable in fact that it’s surpassed illegal drug trafficking as a felon’s #1 moneymaker.

And wireless email users are a juicy and easy target.

· Wireless email users are expected to rise to 300 million this year

· Worldwide there’s 1 known hacker for every 15 wireless email users

· 10 million Americans will become victims of identity theft this year.

· An identity thief has only a 1 in 700 chance of being caught by law enforcement

· 70% of identity theft victims may never recover from damages to their credit rating

· 47% of identity theft victims may not be able to get a loan continue

Sirius XM Radio (SIRI) has made an almost miraculous comeback from irrelevancy (and penny stock land) over the past few months.  SIRI has seen its stock rise from the low $.50’s at the end of 2009 to a recent high of around $1.15 just a few days ago.  This was very good news for the company.  Since it was facing a NASDAQ delisting and with the stock trading above the magic $1.00 mark for a period of time, SIRI was thinking it was “scot-free”.  Think again.

Last week’s drop (and this week’s continuing drop) was not surprising given the overheated condition of the stock from all indicators.  It is not clear what effect short sellers had in the decline since the short squeeze had been on for many months with the advance of the stock price.  SIRI fought through all of those challenges….that is until now.

SIRI has one more chance to regain compliance with NASDAQ regs if it can trade above $1.00 for 10 consecutive days before the March 15th date imposed by the exchange.  I don’t see that happening.  The reverse split that has been discussed seems the only option now despite management’s contention that they will be able to get a variance on appeal.  NOT BLOODY LIKELY.

SIRI should have executed the reverse split when they were so strong late last year.  The market was really pumped on SIRI and its progress.  Institutions were buying and retail investors were very happy with the run-up.  Now with a delisting notice sure to come, short sellers will be circling SIRI like sharks looking for blood.  I think the short term outlook for SIRI is definitely bearish.

Here is a chart that shows what I mean.

Is SIRI a dead dog?  Will shorters drive this one right back down to 50 cents (or lower) again.  I don’t think so.  SIRI is in a “stew of its own making”, but I think will be a good stock to buy on dips.  Right now, I would hold off (unless you are shorting the stock).  The boards and investor sentiment are telling me that this one has farther to fall.  Retail investors might not like it when they do the reverse stock split, but IMO it is inevitable.

Do your own due diligence.  It continues to be a hot topic on the boards that I monitor and it is fun to read what people write.  Make up your own mind.

Good luck and good trading,

Jeffrey Dean

Editor-in-Chief

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

I got an email yesterday  from one of my members (Jeff D.) asking me my opinion on what happened to Labopharm, Inc. (DDSS).  Jeff was at a loss to explain why DDSS’ shares dropped so preciptiously after getting FDA approval on one of their signature drugs.  In some ways, so am I.

Headlines like this one:

Labopharm Receives FDA Approval For OLEPTRO(TM)

usually means that a drug stock will rocket upwards.  Not in DDSS’ case.  The stock lost 40% of its value in just a few days.   Read full release here

You can see from the chart here just what I am talking about:

Stocks dropping on news of approvals is not uncommon ( see BDSI, NRIFF, PK and others), but it is still unexpected.   DDSS, the company, actually has a lot going for it.  It has income (no profits), cash in the bank, good ratios, manageable debt….and a big payday coming some time this year.  I have read where DDSS is in talks with several larger pharmaceutical firms regarding the commercialization of their newest drug, Oleptro.  I can only imagine the frenzy at DDSS offices as they take this surprise announcement and try and turn it into revenues.

I am not terribly surprised at the drop given the rise in the share price in anticipation of approval.  And, I am betting that DDSS will come back and come back strong.  Since I am a technical analyst, I will share one last chart with readers that backs up my contention.

This chart shows how volatile the stock has been and I think it is illustrative of the recuperative powers of DDSS.  You can see that the stock is trading within normal ranges and has shown great historical elasticity.  I would not be too worried about this dip and, in fact, would see this as a buying opportunity.  Having said that, there is support at $1.75 and $1.40.  I don’t think it will drop to those levels, but…you never know.

DDSS is both a short-term and a long-term hold.  In the short-term, I could see the stock regaining much of its recent losses.  It certainly seems like the sellers are out.  In the long-term, DDSS could be a “gold mine”.  I will watch with great interest for news on how they will commercialize this and what the financial ramifications are for the company.

I didn’t spend any time in this blog on drug pipelines and other pharma standards.  I expect that my readers will do their own DD.  Here is DDSS’s website link for your own research.

Trade like you mean it!

Jeffrey Dean

Editor-in-Chief

Note on 2/12/10:  DDSS is getting hammered.  The market did not like the news of their $20MM  offering.   DDSS blew through the $1.75 support and is headed down to the $1.40 level.  MIght be best to take an EVEN more cautious approach to this one.

I released this pick on my Twitter site a few days ago and have followed it since.  I didn’t have time to do a blog on it until now.  I think that the trend is ZAGG’s friend once again.

ZAGG was one of last year’s stock stars vaulting from $1.00 to almost $8.00.  And, like most stars in the stock market, it was a “shooting star” and its fall was almost as dramatic as its rise. The stock hit a low of $2.10 just a few days ago (that is when I posted it to Twitter) and has made a strong recovery.  A recovery that I think might have some legs.

This is strictly a chart play.

Oh, yeah…what does ZAGG do?  ZAGG Incorporated designs, manufactures, and distributes protective coverings, audio accessories, and power solutions for consumer electronic and hand-held devices.  ZAGG is solidly profitable, has cash in the bank and no debt.

Will ZAGG get hot again.  Watch it and see.

Jeffrey Dean

I must admit that I am an alternative energy junkie.  I love all things alternative:  I love the almost infinite variety of wind, solar, biofuel, CO2 to gas technologies that are out there.  Each one of them is exciting on its own merits and each has a claim to be “The One” that makes it to the next level.  Could RZ be one of the winners?

Raser Technologies, Inc. (RZ - NYSE) is (from RZ’s website) an environmental energy technology company focused on geothermal power development and technology licensing.

RZ has two divisions:

1. Raser’s Power Systems segment is seeking to develop clean, renewable geothermal electric power plants and bottom-cycling operations, incorporating licensed heat transfer technology.
2. Raser’s Transportation and Industrial segment focuses on extended-range plug-in-hybrid vehicle solutions and using Raser’s award-winning Symetron™ technology to improve the torque density and efficiency of the electric motors and drive systems used in electric and hybrid-electric vehicle powertrains and industrial applications.

RZ is making only nominal revenues with large losses every quarter.  Looking through their website, press releases and 3rd party articles on them is impressive.  They really appear to have some great technology and prospects.  The Evergreen Clean Energy LLC joint venture seems to hold great promise.  Read the release here.  Evergreen, a newly-formed alternative energy fund, has agreed to fund several RZ geothermal projects in the U.S. The recent news of the appointment of a new CEO, Nick Goodman, didn’t do much for the stock,  Mr. Goodman seems to have a solid resume and could be just the guy that the company needs….time will tell.

But, since we live in the real world, let’s talk RZ as it stands right now.  RZ has, according to its own balance sheet, maybe two quarters of life left based upon the present cash burn.  The liquidity ratios stink and the company has a great deal of debt (more than it can comfortably service along with huge R & D expenses each Q).

The chart, on its face, doesn’t offer much hope either. The prolonged bearish slide doesn’t appear to be slackening.  Or does it? Candlestick chart analysis gives us some insight into the chart.  Most of the sticks during this decline were long bodies or Maurbozo’s (in a declining chart, that means that sellers ruled).  Buyers put little resistance and the stock was bid down every day significantly.  Except, that is, for the last two days.  We are actually seeing tails develop on the candles which means that buyers and sellers are struggling over the stock.  In fact, yesterday’s candle shows that the sellers drove it down, but the sellers brought it back up to close near the top of its trading range.  The key for RZ is to watch for confirmation that the sellers are getting “exhausted” and that the buyers are coming back in. The oversold stochastics is an important indicator, but until the MACD intensity diminishes, the stock could continue to fall.

Here is my annotated chart:

Any good news could really send this one soaring.  I recommend that traders watch this one and keep it on the radar.  Technology-wise, RZ appears to be a “good horse to back”.  If they can get some financing for general operations and if the Evergreen deal comes through, this could be a HUGE winner.

Lots of variables, though…..

Good luck and good trading,

Jeffrey Dean

Friday’s biggest price decliner on the NASDAQ was Yucheng Technologies Limited (YTEC). The only PR I could find was that the stock got downgraded from Market outperform to Market perform by Avondale, a research firm.  The stock was trading for under $7.00 on Thursday at close.  Friday saw a massive selloff and is now trading for roughly half that.

A typical market overreaction?  Maybe, but I thing that YTEC won’t be down too long.

Yucheng Technologies Limited (YTEC) describes itself as the “Leading IT Solutions Provider for the Chinese Financial Services Industry”.    Essentially, the company provides information technology (IT), software, solutions, and services to the banking sector in the People’s Republic of China

Here is what I was able to glean from the financials (9-30-09 Q)

• $1.18 in cash per share
• No long-term debt
• Strong cash position
• Great ratios
• Profitable Operations

True, the rampant growth of the company has slowed, but it is still a very strong company.  Traders and investors seem to be punishing the company for its dismal earnings report for 2009 and a less ambitious outlook for 2010.

Here is an annotated chart to demonstrate just how steep the drop was.

Of note: The stock dropped hard on Friday, but it gapped up at open today by 7 cents.  It appears that others suddenly saw YTEC as a bargain and bid the stock up.

Interesting stock to watch and now it is priced much more attractively for traders.  Will YTEC recover and close the bearish gap?  I am watching it with interest myself to see.

Be careful not to “catch the falling knife”.  My gut is telling me that the knife has stopped falling.  However, it may limp slightly downhill or sideways for awhile before it re-establishes a bullish trajectory.

The faint of heart need not apply.

Good luck and good trading

Jeffrey Dean

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When you have been an investor/trader as long as I have, you tend to create favorites. I have my favorites certainly, stocks like JDSU, LGDI, TASR and today’s blog topic: American Oriental Bioengeneering, Inc. (AOB).  I have been aware of AOB for years and have traded it/blogged it to great success.

In fact, it was one of the first stocks that I blogged on this site.  You can read my blog here. I was right about it then, as this chart would indicate.  AOB was profiled around $4.25 and soared to $5.70 in about a week.  I was right then….I wonder if I can be right again.

Headquartered in China and with most of its sales in China, AOB’s develops, manufactures and sells plant-based pharmaceuticals, nutraceuticals and food supplements. Its product are designed to treat a wide variety of ailments under a number of brand/trade names.

The company was founded in 2001 and has enjoyed a great run.   Upon reviewing the financials, I can see that AOB makes money! Every year for the last three years, they have posted a profit.  Sales and profits have slowed down somewhat this year, but AOB is on track to post another profit for 2009.  The balance sheet is strong with great debt coverage ratios.  Debt is high at $116MM (33% of equity), but the company’s cash balances and cash flow are sufficient to service the debt easily.

Here is a two-month chart that shows the recent trading action.

AOB is a great radar stock…..It has shown strong volatility in the past and looks to me like it might be ready for a bounce.  It will be instructive to see if it will hold above the current support level.  Any break below it and the stock should be avoided.

Good luck and good trading,

Jeffrey Dean

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

I did a screen for small cap stocks on a losing streak of over 7 days and came up with several Junior Gold stocks:  Golden Star Resources, LTD (GSS) and Apollo Gold Corporation (AGT).  One is a company that I would suggest putting on the radar and the other is one that I be very cautious with.

Part of the reason that these companies are here is because of the slide in the price of Gold.  Once gold resumes its upwards momentum, stocks like these could become supercharged

Be careful with  Apollo Gold

Apollo Gold is a junior miner that is increasing revenues incrementally, but not making any money while doing it.  Their losses, through 3 quarters, is almost $38MM.  I realize that a great percentage of that are paper losses from writedown of assets in 2009.  Then, the theory goes, if they have a strong balance sheet things should be o.k.  Unfortunately, they don’t have a strong balance sheet.  They have lousy liquidity ratios and  long-term debt that is due and payable and has been accelerated.  Things are so bad that the company has put its 50% interest in the Montana Tunnels Mine property up for sale.

Here is the chart with my annotations:

I would never suggest holding AGT long-term, but you can play the volatility.  This is not a stock for the faint of heart.

A Golden Star?

Like AGT, GSS can show a steady climb since December of 2008 when it was trading for only 50 cents.  GSS is significantly larger than AGT and could book over $350MM in sales for 2009.  However, they are showing losses quarter over quarter, too.  Their balance sheet is not pristine, either.  Their ratios are better, but GSS has taken on a great deal of debt.  The company is trumpeting the fact that 2009 was their best year ever, but they need to continue to increase revenues and get a handle on expenses for the investing public to be convinced.

GSS should be watched to see if it continues to decline and touches the next support level.  I don’t think it will. Seller exhaustion may have set in and prices could rise.

Both companies, I can only imagine, are hoping and praying that Gold prices come back.  And, it is not like gold prices have crashed, either. The spot price at 10:33 a.m today as I was writing this was $1,098.55.  But, in the mind of traders and investors, gold prices are “DOWN”.

Both are good radar stocks and could run on news specific to the company or about gold in general.

Good luck and good trading,

Jeffrey Dean

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

China did not have a good week last week.  The overall market stunk and China really got hammered.  One of those stocks getting hammered was GC China Turbine Corporation (GCHT).

However, GCHT didn’t stay hammered.  It rallied strongly the last two days of last week, but it still at an attractive entry point (IMO).

GCHT is a licensee and manufacturer of a proprietary two-bladed wind turbine.  Their initial product is a 1 MW turbine that has been a “hot-seller” for the company (according to the company that is).  It is much different that last week’s wind power blog topic, Helix Wind (HLXW).  GCHT is doing utility grade turbines that are being purchased by utilities and regional governments in China.

What is exciting about GCHT is not contained in its historical financials….it is in their press releases. The company didn’t deliver its first turbine until the 4th Q of 2009, but they are on an accelerated pace.  They are estimating revenues and profits of $19.6 MM and $1.5MM respectively.  That is after ZERO revenues the previous 3 Q’s.  The release (read it HERE) goes on to state GCHT is forecasting initial orders of 160 wind turbines, worth in excess of US$135 million and a 2010 revenue forecast of $87MM. The release went on to state that the product line will expand with the addition of $2.5MW and 3.0MW wind turbines.

Here is the chart so you can see what I am talking about:

GCHT is at a crucial juncture…If it can penetrate resistance at around $2.90 and hold above there, I could see it running and retesting the 52-week high of $4.07.  The news is certainly positive for the company and it appears to be heading in the right direction.

Good luck and good trading,

Jeffrey Dean