Mr. Darruda: Let's face it. IMMM is an event-driven penny stock. Forecasting short-term price target of this type of stock should be the job of a fortune teller, not a tea leaf reader. A low priced stock tends to have a low price/volume volatility which makes tea leaf reading one tough chore. I don't normally speculate in low priced issues. However, since I am in, I'll take a shot at it. Please note the following analysis is NOT a forecast becasue I am NOT a fortune teller. I am only a trend follower who uses past trends to paint a picture which allows me to peek into the future. Here we go.
**** Mr. Elliott and His Five Waves ****
Price movements of securities can be generally categorized into 5 stages as follows:
1. Base building
2. Breakout
3. Expansion
4. Distribution
5. Decline
Stage 1 base building is boring stuff for orphans and widows. No further comments. Stage 4 distribution and stage 5 decline are for short sellers. Profit potential is there but is also limited to 100% mathematically. I pass. Stage 2 breakout and stage 3 expansion are King makers and by applying the Elliott Wave Theory to them can be rewarding. This is my cup of tea.
Assuming IMMM had a Elliott Wave 1 breakout move in November that drove the price from $0.18 to $1.50 in early December. The difference of these two numbers is $1.32 which represents the initial surge of Wave 1. Wave 2 correction followed and tanked it to $0.375. Should this number hold, it represents the bottom of the interim Wave 2 correction. We are now on Wave 3 expansion which is by far the most profitable wave in the 5 wave counts. How far will it expand? Experience tells me that the most likely projections, according to Mr. Elliott, is 1.62 times to 2.62 times of the initial surge of Wave 1.
Hence the minimum projection is 1.62 x 1.32 + 0.375 yielding $2.50, and the maximum projection is 2.62 x 1.32 + 0.375 yielding $3.83.
Therefore, being a tea leaf reader, I would use these two numbers as my short-term price targets. Please note that NOTHING is cast in concrete and wave abortions do occur. In such a case, the best thing I would do is to follow the trend and let the trend tell me what to do, instead of blindly adhering to the Wave principles demanding the completion of Wave 4 and 5.
Enjoy your ride.
Best wishes,
Mad Monk
Disclaimer: The above is pure tea leaf gazing intended to impress the cocktail waitresses in the sushi bar. It has NO investment value. For sound investment advice, please contact your stock brokers or Mr. SOROS, the Bat Cave dweller.
|
