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Technology Stocks : VALENCE TECHNOLOGY (VLNC)
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To: Doug McKenzie-Mohr who wrote (11591)5/31/1999 1:55:00 PM
From: mooter775  Read Replies (2) of 27311
 
Doug,

I would be careful to use extensive margin on Valence. They will need to finance within the next 3 months and one can envision a scenario that there might be some pressure on the stock if the financing has to be done and there is no further contract/purchase order/relationship prior to that time.

I think you should try to protect yourself against a margin call perhaps as low as the $ 5.00 - $ 5.50 range in the absence of a contract.

On the other hand, if there is a contract announcement, I think there will be a significant short squeeze as the stock moves into the teens.
I personally know of a number of investors who are saving margin in order to purchase additional shares at that time - and "aggravate" the squeeze. I will be one of them.
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