David, you were talking about the T/A and charting of FTEL. I just drew 3 trendlines, the bottom is at 1.37 the middle is at 2.50, and the top is at 3.62. We have broken well above the 50 and 100 day moving averages and both of which are starting to trend up, and we have a very sharp rise in the 21 day moving average.
I have run several T/A parameters and coupled with the anticipated news, Franklin should establish new highs within the next few weeks and $2.50 level should become it's new support level. One of the T/A factors that I place a lot of credence in is the MACD index. Also one index that is seldom used is what is called a cycle chart. The best way to describe it is that stocks seem to all have their own characteristics and timeline rythms, this in turn creates up and down cycles that are pretty predictable. As we enter February we also are
heading into an up cycle that would probably peak sometime in mid to late March. If you ran the trendline out to that time period, we could be looking at a price that would reflect a price above $5.00. Because
charts end at the last trading date, it is difficult to extend a timeline out and therefore the price ($5.00) is a conservative guess, especially when you take into account the upward angle of the trendline as to where it would cross a price point in the future.
What really gives me faith in this optimistic pricing estimate, is when you match it up with known events that are anticipated. FTEL will be receiving about $2 million of cash injection off exercised warrants, the
Cyclone will be in distribution, some of the advanced telephony services should be either in service or be in the beta stage, and all the OC3 lines should be up and running by that time. We should also consider the impact that FNET may have on the price of the stock when the IPO is announced. Which brings up a new scenario.
Would if FNET didn't IPO, but instead was acquired from a strategic alliance partner? Think about it. it's all there. The building blocks are already in place. So what are they waitng on? Could it be the introduction of some key equipment? Is there more to this than meets the eye? Remember that FNET is now almost like two separate companies divided between local access numbers via WCOM and 800 service with Connect America, then you can also subdivde that into corporate accounts and personal accounts. Remember how PSI split out their accounts, kept the corporate accounts for themselves, and sold off the personal accounts to Mindspring.
Never take your eye off the fact that FTEL the parent company is the equipment provider to anything connected with FNET, no matter how it is structured. Is this why FNET was created? And then ask yourself why WCOM and GTE so eagerly crawled into bed with FTEL. It wasn't based on Franks good looks.
Tie it all together and your looking at one explosive situation that may play out before our very eyes. Is it conjecture? Yes. But it is the only thing that makes sense to me.
RB |
