The down day was from at least these two things.
One, technicals show that CDNW got ahead of itself in the movement upward from the early activity that resulted from the few people who mentioned the TWX news. It has yet to catch on to most media vehicles and many probably did not see it late last week as they left town for the holidays. This is my opinion.
Two, The overall Nasdaq market took a breather, though a small one. I was surprised to see CDNW give up so much. I bet people expected a bigger rise from the TWX news, and when they saw that there was no HUGE spike, jumped all over the price thinking the news was BS. That is not the case, IMHO.
We have nice support from the 50-day moving average at about $18. We haven't gotten closer than $3 above the 50-day moving average in the last two months. This translates into a low of $21 at worst near term. Each time we hit a level only $3 above the 50-day moving average, we surge again. By the end of the week, the 50-day moving average should be about $19.50, but I will estimate we "see" $30, then again retracing back toward the 50-day moving average the following week. This takes into account a general upward bullish trend without any good or bad news.
I do not anticipate bad news anytime soon, unless it has something to do with the overall market, which there appears to be none in sight. I expect more information about the holiday sales online much like we get a feel for cash register sales from the traditional onland retailers. A good report, which I expect, and we may surge beyond my estimates. Also, I expect more information about TWX potential interest in CDNW. There will be more people reporting on it out of speculation. WHY? It makes good headlines and has a nice story. TWX has constantly been mentioned as a player that needs to get their teeth into the internet. CDNW combined with NTKI is THE onlinemusic player. Even if it wasn't, TWX would want to get their Columbia House division a real ally in this space besides AMZN, as AMZN's ridiculous valuation commands big bucks if you want to buy into them. CDNW's low price offers an EASY way in for the rich TWX. TWX knows the reach and growth of CDNW. I do not see a negative. If TWX chooses not to buy into CDNW, then they are saying they feel comfortable competing with AMZN and NTKI/CDNW on their own, and obviously they are getting their ass kicked, so that would not be smart. Also, by waiting, the valuation and price for buyin gets more expensive every week.
The sooner the better for TWX.
If and when it happens, we are looking at a major boost. We would see major strides in the market price of our shares.
Miller |
