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Microcap & Penny Stocks : CMOZ, next cmgi -- Ignore unavailable to you. Want to Upgrade?

To: daViking who wrote (98)	1/24/1999 11:17:00 AM
From: TOPCAT1	Read Replies (2) \| Respond to of 947

Technical Trading Analysis - this can be revealing.... Looking back at the trading pattern of any stock can tell a lot about its future potential... for example, don't buy a stock that is going down because of an acquisition failure but rather buy a stock when its new trading direction is confirmed (usually first by the positive price action and then by an acquisition)... when playing penny stocks, initially I don't much care about who is involved with the company, I simply react to the action (this is the first speculative cycle of a play)... once an acquisition is made then a careful second look at its potential is required... yes, management is critical but the second cycle is usually driven by the type of market the stock is in, for example, mining plays speculate on drilling results while Information Technology plays speculate on acquisitions... once these two cycles are over, revenues become very important in sustaining the long term price of a stock... HOWEVER, E-commerce stocks appear to be in a class of their own, valuation seems to be determined by the number of people in their database (this is then translated into the potential of the stock), obviously the ability for corporations to mine databases appear to be more valuable than for companies to mine for gold... one other factor which makes E-commerce stocks so HOT at this time is the rapid growth of the internet (all signs indicate the growth is even faster than predictions made only 1 year ago...!!!) So... let's look at the trading pattern of CMOZ (formerly MISM)... I don't think anyone will argue that acquisition failure and business failure resulted in the downward price slide of MISM over the last year. A year ago MISM traded in the $0.35 - $0.45 range (January-March'98) but continued to slide further reaching a plateau in May ($0.25) and then further reaching the $0.04 level (September-November'98). There was very little trading during the last period as the company started to refocus and look for acquisitons (as what all companies do). In my opinion, they made the correct strategic decision to move into the Internet and E-commerce sector, which clearly is one of the highest growth sectors in the economy. In December there were a couple of spikes to $0.15 (the first indictation that discussions were beginning leak out and investors were beginning to speculate), then in early January the price moved up significantly. Now the fun begins... in my mind, the critical question is whether the trading over the last week (ending in a press release on Friday outlining an acquisition) will lead to a sustained run or is the play over? Not an easy question to answer, several factors can influence the action... 1) do they have other acquisitions in the works as suggested by their initial press release, 2) will they attract the attention of Venture Capitalists, investment funds, etc. that are willing to participate in financing future acquisitions, 3) what type of promotion do they have planned (radio, TV, Banner advertisements, etc.), 4) the size of the float and how many shares are held in escrow will affect the trading volume required to move the price up further, 5) will investors see this play as a potential cheap entry into the E-commerce game (especially when you compare what has happened with other similar plays E-commerce plays, 6) will people exiting over-valued E-commerce plays position in plays like CMOZ because of the excellent leverage it represents, 7) InvestorsGURU appears to be a successful stock market site with several sources of income (and stated always profitable) but more importantly a good size database of 16,000 users which represents significant potential marketing and E-commerce traffic... WELL... obviously this is very difficult to determine, so let's look at the technical action over the last week and see if that will give us a few clues.... Jan 14 0.13 500,000 Jan 15 0.20 1,483,300 Jan 18 closed Jan 19 0.31 1,838,000 Jan 20 0.41 2,302,100 Jan 21 0.38 1,829,000 (new high $0.56) Jan 22 0.41 2,696,100 (shakeout to $0.26 on news but recovery) Total 7,952,400 The first speculative cycle quickly drove the price to $0.56 on Jan 21 (there was some profit taking and consolidation during Jan 20 and 21).... early Jan 22, the MM's drove the price down to $0.26 then suddenly the price rocketed as rumour of the acquisition was going to be released (the inability of the President(Wilfred Chan) to close a deal no longer appeared to be true)... once the press release hit the market the stock pulled back to the low $0.30 range but consistent and strong buying pushed the price to close at $0.41 on over 2.6 million shares... the technical chart says more action is coming... if the price would have dropped then this would have suggested to me that investors close to the play were selling (essentially taking profit off the table) but that didn't appear to be happening... something is holding the price at these levels, my guess is one of the following three things: 1) another acquisition in the works, 2) potential investment to pay for the acquisition (ie. Venture Capital, mutual and hedge funds, etc.), or 3) strong promotion planned which will lead to increased exposure and more buying... Of course, do your own Due Dilligence... technical charting tells about the history of a play and is fun to do but it does not predict the future... the next week of trading is going to set the pattern for this play...

To: daViking who wrote (98)	1/24/1999 5:11:00 PM
From: Ned Land	Read Replies (1) \| Respond to of 947

Hope you don't lost your money David. Different type of stocks go up for different reason IMO. Small stocks go up in anticipation of big things in the future. The stocks of mature companies that sell things at a premiun to their cost go up when the economic outlook improves. The stocks of mature companies in competative industries go up when they manage their costs better. The company hasn't disclosed its financials, it cash position, where its office it, whether Dan Masters is a director, how many shares are out, what the terms of the acquisition are, and most telling, they have not acknowledged that the other deals are a dead leter.