Andrew, A few comments I received via Email based on requests for opinions from several sites...Pplease note to all these are just opinions not recomendations... as mentioned by one person volume has in fact declined as the selloff proceeded.
1)Although UFAB was priced at 18.00 it actually opened at 29 on the first day of trading. This offering was at a time when the sector was on a high. Since that time the sector has made a minor correction and that is possibly what we are seeing in the current value of the stock. Although it is tempting to jump in right now I would wait for the true bottom to form. It has been all down hill for the last 13 days and if the sector gets some good news from OPEC it could rebound nicely. WAIT FOR THE BOTTOM TO FORM. Only my opinion.
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>Happy trading. :}
2)Dear Bryan,
This is a hard question to answer. However, in general IPO's are not
good investments except for the initial flurry the first day or two. In this case, as long as the initial offering price holds there could be a subsequent rally. However, should the initial offering price be broken the price could fall quickly to half. One strategy would be to buy here and put a stop-loss in under the initial offering price but that would mean you may have to take a quick loss. I haven't had a chance to look at the chart and a good clue here would be the volume as the stock has sold off. If the stock is retreating on relatively light volume, then the odds increase that a subsequent rally will unfold. However, if there is big volume during this selloff, it is not a positive sign.
You also might want to check the news on the stock as I suspect there
has been some negative announcements on the future prospects of the
company, hence, the unexplained selloff.
This letter is not intended as investment advice and any subsequent
trading is at your own risk. (I had to say that).
You might get some additional info from the IPO report in MarketCentral
at mktctl.com.
Regards,
Roy Spectorman
President
3)Hello, Bryan - Thanks for your e-mail regarding our opinion on Unifab (UFAB).
We don't trade on news or fundamentals, since Commando is a statistically proven pattern recognition system.ÿ Therefore, we would not be entering a position in UFAB until a tradable formation occurred, which is not currently the case.ÿ In reviewing the UFAB chart, Commando would have given us a three signals:
Buy signal at $35.00 on October 6, exiting at $42.
Sell signal at $33.00 on November 12, exiting at $22.
Sell signal at $30.00 on November 18, exiting at $20.
Hope this information helps.ÿ Please let us know if you have further questions.
Sincerely,
Robert McCaleb
Commando Trading Systems
4)Hi Bryan,
It's very difficult to make a sound analysis of a stocks prospects when it is as new and unseasoned as UFAB. But for what ever it's worth we will give it a try.ÿ On all technical indicators, the stock appears extremely oversold and due for a technical bounce.ÿ The bad news it this; very seldom do you see a stock hit such extremeÿoversold levels and turn around and zoom right
back up. Usually, a period of base building will follow the first technical bounce particularly after a 15-5-5 stochastic goes to such an extreme reading.ÿ Theÿ good news is that as the stock has continued to decline over the last few days, the RSI has not confirmed that move. Aÿ divergence is occuring that would call for caution if you were short but it is not signiicant enough to call for adding to your position.ÿÿÿ
Again, when a stock is as unseasoned as UFAB, with no following yet on the street, extremes on the upside as well as on the downside are often seen which down the road will make no sense fundamentially or technically.
Good luck, Scott Ruppert, ASK Research
5)Bryan,
Charts don't get much uglier than does UFAB's.ÿ If there was ever a
stock due for a bounce - any bounce it would be UFAB.ÿ This stock will
only move higher when the sector heats up and traders start to look for bargains.ÿ It is oversold to say the least.ÿ However, this isn't
uncommon to see a trend like you have observed.ÿ I have a friend who
only trades IPO's and looks for a situation exactly like this.ÿ I don't think you want to try to bottom fish it though, wait for both sector strength and a reversal of the stock's trend before nibbling.
Hope this helped.
Roger
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