Checking Up On Two Of Our Recent Winners (LTEA & ETRM)
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As we’ve emphasized a number of times over the past few months: This is a special period for traders. Gains are being given away by the market. Moves are being telegraphed (if you know where to look), and the big promoters are picking obvious spots that we can run out in front of and capture huge moves.
It’s an art right now, but a lot of these plays are ripe for the picking.
Today, we want to bring you up to date on a couple prior picks that are making some new waves: ETRM and LTEA.
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ETRM Bouncing Off the Lows on Positive IP News
Company: EnteroMedics Inc.
Latest News: http://finance.yahoo.com/q/h?s=ETRM+Headlines
Company Website: http://www.enteromedics.com
ETRM is a stock we first pointed out a couple weeks ago. We’ve stayed bullish on the name for a bounce, and it paid off bigtime yesterday.
The catalyst? Headlines suggesting that the European Patent Office has issued a Notice of Intention to Grant a European Patent covering safety features of the Company’s vBloc Neurometabolic Therapy System. The intention to grant the European patent follows the granting of U.S. patent and represents the Company’s 70th patent in its IP portfolio.
The news was worth 40% in gains at the highs intraday. That’s the first strong push off the lows since mid-August, and may represent at least a reprieve from the spiral that has gripped this stock during its recent trend.
Note, the stock has seen something like capitulatory volume of late, with transaction levels pushing 550% above the stock’s longer run average levels. Traders should note this as important with the stock trading on a float that is relatively small at just 26.96M shares.
That combination can easily set up a price squeeze as share supply is pinched. Keep an eye glued to this stock if you haven’t been watching.
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LTEA Sets Up Nicely Off Retracement Support
Company: Long Island Iced Tea Corp.
Latest News: http://finance.yahoo.com/q/h?s=LTEA+Headlines
Company Website: http://www.longislandicedtea.com
As we have been covering for the past month, LTEA presents an interesting opportunity. The stock features strong technicals, serious growth, excellent market positioning, and a clear expansionist operational framework in play from the board and upper management.
To say the Company has an “expansionist framework” is probably understating things. Just last week, the Company announced that it partnered with SellEthics Marketing Group, Inc., the largest regional food brokerage in the Southeast, to further expand its distribution in the Southeast. That comes right on the heels of an announcement a week earlier that its beverages are now sold through Krasdale Foods (“Krasdale”), which services over 2,500 customers across seven states in the Northeast.
The march of progress.
We’ve highlighted the details on a number of occasions. Today, we just want to point out the interesting technical setup in play for perhaps another run like the one we had with this in August, when we captured as much as 40% in gains in just a few days (we alerted this stock at $4.67, right before it launched higher over the next couple days to challenge the $6/share zone).
The stock has recently checked back to key Fibonacci support in the $4.80 area, as the chart shows. If you don’t know Fib levels, it’s time to get on Google and figure it out. The pros use it obsessively, and so do we.
LTEA is showing all signs of a perfect Fib retrace back to key support. That often precedes a break above the prior level resistance, which might imply a move above the $6 level from here.
Keep an eye on this one!