AR,
Fundamentals must be considered when picking a potentially good stock for price appreciation and why to avoid a stock destined to decline in price; but fundamentals won't tell you when these stocks will make their move.
I like the long term upside potential for LCAV, but not at the present time. All momentum indicators (MMI's) for daily and weekly charts are in negative trends, RSI and OBV are neutral (no upside or downside bias); short, intermediate, and long term stochastics have either topped or are in a sell configuration.
As far as volume is concerned, low volume declines are not necessarily a good sign as this generally shows a lack of interest in the stock. What is needed here is increased volume either up or down to define the support and resistance prices, and a subsequent price reversal to indicate investor conviction and consensus.
In the meantime should this issue be purchased for long term price appreciation? The answer to this question will depend on the "long term" time horizon of the potential investor (how long is the investor willing to wait until his/her price objective is met). As for me, in the light of the indecision pattern exhibited by LCAV, I am not willing to "park" my investment capital on any stock (good or bad) under the "hope and chance" that unforeseen factors will move the stock higher. There are just too many negative factors overhanging the "market" that could carry stocks down to lower prices at the present time.
LCAV is and will be a good candidate for price appreciation, but let the technical indicators confirm your investment decisions, don't let guesses, "gut feelings", or "biased-hype" control your moves.
Harry |
