We have the luxury of being able to trade and invest in many foreign stocks.  China has been BOOMING, and particularly in the Shenyang area: an industrial mecca.  As manufacturing demand continues to increase, so does the need for power.  Today’s Company Invest pick, A-Power Energy Systems, provides onsite distributed power generation systems and micro power grids for industrial companies Shenyang, People’s Republic of China.

COMPANY PROFILE:

A-Power designs, constructs, installs, and tests distributed power generation and micro power grids as stand-alone facilities for various customers in the steel, chemical, ethanol, cement, and food industries. The company also offers automatic control systems to monitor the performance of equipment in the system, including the boiler, turbine, generator, grid supply, and demand and distribution, as well as space and water heating functions. In addition, it manufactures and sells wind turbines.

FUNDAMENTAL TIDBITS:

• A-Power features a LOW price to sales ratio of 0.83, making it a value play.
• Share price of under $6 makes it an affordable trade
• High Beta of 2.95 means profitable, fast trades when technicals flash buy signals
• 16.5% short interest means short covering could elicit a nice gain fast!

COMPANY INVEST TECHNICAL ANALYSIS

Once again, we find most of the US stock market in an overbought state.  Not the case with APWR.  Starting at the top of the chart is the ADX momentum indicator.  The indicator got a bullish +DI cross on 2/13/11 which has since been confirmed.  Further, the ADX line which measures trend strength looks ripe for a nice run after bottoming out at the recent 2011 selloff.

Looking at the candlestick daily price chart, APWR had a 3/10 Exponential Moving Average cross (GOLDEN CROSS) yesterday, 2/14/11 that was confirmed with a higher close today.  This is extremely bullish.  Look at the chart and the excellent signals it gives on the 3/10 EMA cross.

The MACD is a thing of beauty.  A POWERFUL bullish divergence is playing out.  Look at the WAY higher low that has been formed with the MACD line (black).  Also, look for a MACD/signal line bullish cross possibly tomorrow.  In addition, the MACD is approaching the zero line, which is also quite bullish.

Finally we look at the slow stochastic oscillator.  This oscillator does a good job indicating overbought/oversold conditions.  A healthy reading of 45 shows APWR has positive momentum and there is plenty of juice left in it.  In addition, the weekly stochastic is low and just got a bullish cross.  Company Invest thinks this could also be a great stock to hold even for several months.

Company Invest Bottom Line: This is a great safe entry point for a trade since APWR already has some positive momentum.  Also, the stock is in a wonderful position to place a stop right below the 50 day moving average at around 5.55.

COMPANY INVEST IS BACK!

After a 10 day hiatus we’re back to our chart analysis at Company Invest.  It was time for a breather, but at the same time it’s been a tough stretch to try and pick trades when we are teetering at a pivot point in the market here.   Just when it looks like a sure correction is in the works, boom, a rally wipes it out.  There will be a deep correction in 2011 for sure, when is the only question.   One thing was for sure.  Once the DOW got above 11,700, you knew it was going to run to 12,000 which it hit today.  Netflix had great earnings numbers after the bell, while Starbucks disappointed.  What will tomorrow bring?

THERE IS A SILVER LINING

We shall see, however, as some of my fellow traders at Facebook’s “Trader Pro” know, I’ve been anxiously awaiting an entry into Canadian silver miner, Silver Standard Resources, (SSRI).  If you would have entered SSRI last July and held to the end of the year, you would have had over a 90% return!  But how do you chase a stock after a 90% run?  Now could be the perfect opportunity after a nice 28% correction. With Ben and the Fed cranking the money printing press every day, and the U.S. debt ceiling about to be eclipsed, and bankrupt state governments, precious metals will shine again, and silver has shined brighter than gold in the past year.  We at Company Invest look for that trend to continue in 2011.

Looking at the chart notice the Slow Stochastic momentum indicator.  It has sunk to oversold levels for a third time now, has just got a bullish cross and is the stochastic line is on the verge of breaking it’s resistance at the 21 level.  If it does that with some volume, look for the stochastic to go all the way to 80 on this trip, bringing SSRI along for a nice ride.

On the pricing chart, we had a hammer reversal, with a follow through today, and more importantly, a close above the 5 day SMA, sparking a buy signal. We have SOLID support at the 200 day moving average (20.94), so that’s a great place to put a stop below on a trade if you are thinking of entering tomorrow as I am.

The MACD has produced a PpP bullish reversal on the histogram bars, with a confirming close today above the 1/25/11 high.  Another buy signal.

Finally, we look at the On Balance Volume (OBV).  Look at what happened the last time the OBV bottomed out and hooked back up. Nice trades ensued both times. If the OBV can break above its current level with a gap and go run tomorrow, we could be looking at a very, very nice trade here.

Company Invest Bottom Line: Grab it tomorrow and put a stop below the 200 day MA.  A gap down would actually make for a nice entry.  I like this stock very much.

Good luck to all.

Today’s Company Invest analysis is a very affordable stock you can by for under $3.50.  It’s Denison Mines Corp (DNN). Denison Mines Corp. engages in the exploration, development, mining, and milling of uranium primarily in the United States and Canada. It also produces vanadium as a co-product from its mines located in Colorado and Utah; and recycles uranium-bearing waste materials, as well as gold.

FUNDAMENTAL TIDBITS:

• Quarterly Revenue Growth (YOY): 212.90%!
• Total Cash: 33.11 Million
• Total Debt: 331.K

Phenonmenal quarterly growth and a good balance sheet help to make DNN a buy!

COMPANY INVEST TECHNICAL ANALYSIS:

“A” is the slow stochastics indicator.  After some healthy profit taking, the stochastic is on the upswing again, having had a bullish cross and piercing the 50 line.  Stocks are considered oversold when the are greater than 80, so this run still has some juice in it.

“B” is the daily candlestick price chart of DNN.  The chart pattern happening over the past 4 months appears to be a broadening formation, which would put our upside target north of $4.50, which would be a 34% gain!  There could be some nice upside potential here for sure.

“C” are the daily volume bars.  As you can see, over the past 3 days as a new rally has ensued, the volume has increased each day, which is very bullish.  Volume is one of the most valuable indicators there is because it measures conviction.

“D” is the MACD.  The MACD line has curled up and is on the verge off a bullish cross, while the histogram bars have completed (and confirmed today) a bullish PpP formation.  This is a powerful reversal signal.

Finally, “E” is the ADX momentum indicator.  It looks as if the ADX line (black) has bottomed out at the same time the pullback petered out.  Additionally, yesterday we got a bullish +DI (green line) cross which was confirmed today with a close above yesterday’s high point.

Company Invest Bottom Line: DNN looks like a great trade and is affordable for anyone. Grab it soon and put a stop in around $2.65-$2.70.

AG PRODUCTS GIANT ADM:

For today’s Company Invest pick, we look to the agricultural industry.  Archer Daniels Midland Company (ADM) procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally. It operates in three segments: Oilseeds Processing, Corn Processing, and Agricultural Services. Archer Daniels Midland Company was founded in 1898 and is based in Decatur, Illinois.

FUNDAMENTAL TIDBITS:

Price/Sales Ratio:  0.31 (Great Value Stock)

Trailing P/E: 11

(Both Numbers well below sector averages)

COMPANY INVEST TECHNICAL ANALYSIS:

“A” is the 20 day Relative Strength Index (RSI), a measure of a stock’s strength against its own past performance.  Crossing the 50 level is bullish and even more so considering the stock price is about to cross its 50 day moving average to the upside.  The RSI also put in a higher low which is also bullish.

“B” is the ADM daily candlestick price chart.  After putting in a bottom at the beginning of December ($28.53), ADM has rallied then put in a higher-low around Christmastime ($29.64) and appears on its way up once again.  If it can take out the last minor high ($31.48) the stock has a good chance to challenge the $33.86 top it made at the end of October, 2010.  That would be a nice 10%+ trade and worthy of looking at. As of this writing ADM could easily close above its 50 day moving average.  Doing so would be a buy signal.

The MACD histogram “C” is putting in higher bars confirming a new uptrend.  What’s needed here is some increased buying volume to push the price over that 50 day moving average.  Once that happens, some shorts should cover propelling the stock price up towards our $33.86-$34) target.

Finally, “D” is the ADX directional indicator.  There was a bullish DI cross made on Monday, 1/3/10.  Today’s closing looks like it will close higher than Monday’s high point, confirming the ADX buy signal.

Bottom Line: Should the rally in the broader market continue, ADM looks like a solid trade that could yield 10-12% over the next 2-4 weeks.  Put a stop in at $29.50 (below the last low), and risk/reward is on your side here.

COMPANY INVEST CURRENT PORTFOLIO:

Our picks at Company Invest have faired very well.  Disclosure:  I sold 3/4 of my EXM and TAN today (due to underperformance).  I still think they will be good in the longrun though.

Here we are in the middle of the last trading day of 2010.  Are you happy with your performance in 2010?  Could you have done better?  95% of all traders/401k participants could have significantly boosted there annual return by employing some very simple technical analysis basics.  Technical analysis is the study of pricing patterns on a chart and it is essential for trading success.  We use it in every Company Invest analysis.

I’ve also started to incorporate just a bit of fundamental analysis into this site.  Fundamental analysis includes things like price to equity ratio, quarterly profit, cash flow, debt, market positioning and other factors.  No doubt about it.  Fundamental analysis is good data.  It tells you WHY to buy a stock; But technical analysis tells you WHEN to buy a stock.  Put the two together and ca-ching, ca-ching!

For our final stock analysis of the year, we look at yesterday’s chart of NASDAQ component: Tellabs (TLAB):

COMPANY INVEST STOCK PROFILE:

Tellabs, Inc. designs, develops, and supports telecommunications networking products for communications service providers worldwide. Its products and services enable customers to deliver wireline and wireless voice, data, and video services to business and residential customers. The company operates through three segments: Broadband, Transport, and Services. The company sells its products and services through its direct sales organization, value-added resellers, distributors, and public and private network providers.  The company was founded in 1974 and is headquartered in Naperville, Illinois.

FUNDAMENTAL TIDBITS:

Trailing P/E: 11.58 Making it a find for Value Investors
Return on Equity: 12%
Profit Margin: 14.10% (Could be higher, but not bad)
Total Cash: 1.40 Billion
Total Debt: 231 million (Healthy Balance Sheet)

COMPANY INVEST TECHNICAL INDICATOR TAKE:

Looking at the daily chart, TLAB appears to be a “buy” on several fronts:

“A” is the slow stochastic.  It has just made a higher low and made a bullish cross above the 50 line.  This is very bullish.

“B” is yesterday’s daily candlestick price chart.  There has been two solid days of buying, resulting in a 5/12 Exponential Moving Average (EMA) cross.  The large green and red arrows indicate buy and sell signals generated by the 5/12 cross.   If you had done nothing but use this one indicator over the past 5 months you would have made a better return than most people for the entire year.

“C” is the Moving Average Convergence Divergence (MACD) oscillator.  It has also made a higher low, moved above the all-important zero line, got a bullish cross, and made a higher histogram bar.  BUY, BUY, BUY!

Finally, we look at the ADX indicator “D“.  The ADX line (black line) measures the strength of a trend.  It looks like this line is about to curl up and change direction.  At the same time, we’ve just today gotten a +DI (green line) / -DI (red line) bullish cross.  Look for confirmation of this signal when TLAB closes above today’s highest point.

Company Invest Bottom Line: TLAB looks poised to break out of a range it’s been in for all of December.  It could fill the big downward gap it made in October, breaking $7.80.  It is also a low-volatilty stock (Beta .74) meaning you won’t see many violent price swings.

For today’s Company Invest pick, we move to the bio-tech pharmacy sector.  The stock is Biomarin Pharmaceutical Inc. (BMRN), and it has very impressive fundamentals and technicals.

BioMarin Pharmaceutical Inc. develops and commercializes biopharmaceuticals for serious diseases and medical conditions. Its product portfolio comprises approved products and multiple investigational product candidates. The company’s approved products include Naglazyme, used to treat genetic disease called mucopolysaccharidosis (MPS)VI; Kuvan tablet, a naturally occurring enzyme co-factor for phenylalanine hydroxylase indicated for patients with Phenylketonuria (PKU); Aldurazyme, used to treat mucopolysaccharidosis I; and Firdapse, an orphan drug for the treatment of lambert eaton myasthenic syndrome.  It has many other product candidates in various stages of testing/approval.

COMPANY INVEST TECHNICAL ANALYSIS

Now onto technical analysis indicators and the chart:

“A” is the 14-period RSI.  We often use shorter timeframes with the RSI indicator for swing trades, but as you can see BMRN has been in a powerful uptrend since July.  Powerful stocks like this are considered momentum plays, thus, we have used a longer (14 period) RSI. BMRN has just had an RSI pullback to the 50 level, and now it’s back on its way up.  This is quite bullish.

“B” is the daily candlestick price chart.  A couple of things to consider here.  First, look at the powerful uptrend that has been in place since July (see green trendlines). Those trendlines suggest BMRN could be moving much higher in the near to mid-term.  Secondly, I’ve put the 5 and 12 period Exponential Moving Averages (EMA) on the chart. The last few times the 5 EMA (blue line) has crossed the 10 EMA (red line), the following gains have been realized:

• Early July Cross —        10.5% Gain
• September 1 Cross —   9.76% Gain
• Mid October Cross —    23.41% Gain
• December 20 Cross — ??

The way you trade these crosses is you simply buy on the day of the 5/12 EMA upside crossover and sell when the 5 crosses back down through the 12 EMA.

“C” is the MACD indicator.  Two things of note here too.  First, The MACD histogram (blue bars) have a confirmed PpP pattern.  This is nothing more than a reversal after a pullback in the stock that has occurred over the first two weeks of December (most likely profit taking).  The PpP has a “V” appearance.  Look for the blue bars getting deeper as the stock pulled back, and now they are getting shallower as they head back towards the zero line.

Finally, we have the slow stochastic momentum indicator “D” with a bullish cross and, once again, above 50.

Company Invest Bottom Line: Grab BMRN here for another possible 10% plus move up between now and the end of 2010!  Put a stop below $26.

Today’s Company Invest pick is dry-shipper, Excel Maritime (Symbol EXM). Dry shippers should benefit from Asian economies booming since the dry shipping industry provides vessels to transport dry goods such as iron ore, coal and grain, steel products, fertilizers, cement, bauxite, and sugar and scrap metal. As of March 10, 2010, it owned and operated a fleet of 47 vessels comprising 5 Capesize, 14 Kamsarmax, 21 Panamax, 2 Supramax, and 5 Handymax vessels with a total carrying capacity of approximately 3.9 million deadweight tonnage. The company was founded in 1988 and is based in Athens, Greece.

EXM also fits our other criteria for a Company Invest pick: it has just experienced a sizeable pullback. Remember, we’re always looking for stocks on sale; Trying to chase stocks like AAPL, NFLX and GLD is a futile effort right now. Also, at $5.55 a share, it’s affordable for any investor.

Looking at the daily chart, “A” is our ever-popular 3-day Relative Strength Index (RSI). Look at how oversold it is, and it looks like it is headed back to the 30 level, which is bullish.

“B“is the candlestick pricing chart. Today’s candle opened lower than yesterday’s close, only to hit solid support at the $5.50 area, bounce right off of it and rally into the close. Today’s symbol is a “spinning top” which is a sign of investor indecision. This is significant after nearly a two-week correction. We could be looking at a bottom here.

Look at the recent volume bars (“C“). Do you notice even during the correction, there seems to be more buyers (gray bars) than sellers (red bars)? Volume has been higher on positive days, which is bullish.

Today we also had a bullish PpP pattern (“D“) on the MACD histogram; a sign of a possible reversal. This just means we had a shallower blue bar today, reversing the recent trend.

Finally, the slow stochastic “E” got a bullish cross today.

Company Invest Bottom Line: Take a shot at EXM here with 100 shares and put a stop in around $4.97 . Your risk will only be a mere $50, but if the trade starts going your direction, pile on the shares and  and you could ride it up above $7 for a nice 40% gain!  Risk to reward is on your side on this one!

TAKE ADVANTAGE OF ALTERNATIVE ENERGY PLAYS

The boom in alternative energy stocks has given rise to a boon in alternative energy ETFs. More than a half-dozen funds launched in the past few years, and more are on the way.

The newest wrinkle is funds that focus on specific technologies. Today’s Company Invest pick is “TAN,” an ETF that provides access to the solar energy market.   This fund offers exposure to the global solar energy market and a very inexpensive expense ratio of 0.65%.

We are always looking for pullback stocks to buy at Company Invest and TAN has experienced quite a correction here recently.  It is always better to buy stocks or ETFs when they are on sale, instead of grabbing them at the top of rallies.

IS “TAN” A BUY?  COMPANY INVEST TECHNICAL TAKE

The chart looks very favorable for a winning trade, or even a longer term investment right now in TAN.

“A” is the 7-day Relative Strength Index (RSI), a measure of a stock or ETF’s strength against its recent pricing.  The RSI is giving two buy signals: One it is sitting in oversold territory (20.88) that it hasn’t been in since the end of August.  The last time the RSI was this low, TAN gained 36%!   Also, the current RSI has a bullish divergence (higher low), while at the same time the price is making lower lows.  This is a powerful foreshadowing of a reversal.

“B” is the candlestick pricing chart of TAN.  It has corrected from $9 to the $7 range and a higher low (compared to the August low) looks to be setting up.  Today’s candlestick was a spinning top, which indicates indecision, and more importantly the selling occurred on very light volume.

“C” is the recent selling bars as TAN corrected.  Look at the massive selling peak that took place last week with those huge red selling bars.  Now contrast that with this week’s selling volume.  This tells us the selling may be over.

“D” is the MACD histogram, a wonderful predictor of momentum change.  There is a bullish divergence between the histogram bars and the price.  If TAN can get over $7.50 it will be extremely bullish, as that would confirm the histogram’s directional change.

“E” is the slow stochastic momentum indicator.  Yet another bullish divergence is setting up here.

Company Invest Bottom Line: Grab 100 shares here and put a stop at $6.77.  That way if TAN breaks the August lows, you are safely out.

If you just getting started with online trading and need a discount broker, consider Tradeking.  You can click their ad at the top of the page to fill out a quick and easy application, or, if you want to switch from a high cost broker to enjoy $4.95 a trade, .

It’s been a crazy week on Wall Street.  The move has been mostly down with the exception of yesterday’s tremendous rally because of the GM IPO and a better than expected economic report (Philadelphia Manufacturing).  But all week the retail sector has been strong, and today’s Company Invest pick, Lowe’s (LOW) in particular looks poised for a big rally.

COMPANY INVEST TECHNICAL ANALYSIS

Looking at the chart “A” is the 3-day Relative Strength Index.  As you can see the momentum is positive and it is about to break through 50.  RSI readings above 50 are considered quite bullish.

“B” is the price chart.  Notice, instead of the usual candlesticks, I chose to display a line chart.  This is good for seeing certain patterns.  There is a powerful bullish pattern called the “W” pattern.  Essentially it is a double bottom pattern where the stock sells off, rallies, then pulls back again before really taking off, thus forming a “W” shape.  Two keys to this pattern:  #1 the second “V” of the “W” should not dip as low as the first.  What this says is that after a rally, there was just some normal profit taking (not a heavy selloff).  #2  The most powerful occurrence of the “W” pattern is when you see it occur right under a major moving average.  That’s because many short sellers place their stops right above moving averages.  So the theory is, if the stock price breaks through the moving average, those shorts will be forced to cover and buy back shares they sold, thus making the stock move even higher.  If it sounds confusing, don’t worry.  Just look for the W under either the 50 day or 200 day moving average with the right side higher than the left and you’ve got a winner.   And look at Thursday’s chart of LOW.  BINGO!

“C” is the MACD histogram.  Yesterday we got a bullish pPp reversal on the chart.  This is a 3-bar reversal where you have a selling bar, a deeper selling bar, then a shallower selling bar.  Confirmation of this pattern will occur when LOW closes above $21.64 (yesterday’s close).

“D” is the slow stochastic momentum indicator.  Notice the nice higher low the stochastic put in (green up-sloping line).  Also, we got a bullish touch of the signal line (black) with the stochastic line (red).  Look for a solid cross of the signal line to the upside for confirmation.

Company Invest Bottom Line: Looking at the black parallel lines in the price chart it looks like LOW could easily gain 10% in the near future and move to the $23.25 area for a great trade.  Start with 50 or 100 shares and put a stop in at $1 below the purchase price.

Company Invest Recent Picks:  Still holding ERY and QID despite a rough day yesterday.

Despite Ben Bernanke and the Federal Reserve’s $600 billion effort to prop the stock market and economy, it looks as if a correction is in order now.  Now would be a good time to pause, take profits and sell a portion of your long positions, or, if you are aggressive, why not make money when the market goes down?   You can do that by shorting stocks, buying put options, or, our preferred method, buying inverse ETFs.

We know that the market goes down much faster than it goes up because fear is a powerful thing, especially when coupled with money.  Right now the early signals indicate a 5 to 10 percent correction looming in the S&P 500.  And when the S&P 500 goes down, 3/4 of all stocks go down with it so take heed.  If you want to stay in your long positions, that’s fine.  Use a 5 to 8% trailing stop (whatever you are comfortable with).  A trailing stop is a wonderful tool offered by most online brokers.  It is a variable selling point and is great when you’ve already made money and want to lock in your profits.  If you put a 5% trail in, your selling point is always 5% lower than the current bid for the stock or ETF you are in.  That way, if the price keeps going up, so does your stop, however, once it corrects 5%, your shares are automatically sold, and your profits are locked in.

Today’s pick is QID.  QID is a reverse ETF which moves in the opposite direction of the QQQ’s (technology ETF).  That is when the technology sector is going down, QID is going up.

Looking at the chart there are several encouraging signals:

“A” is the slow stochastic momentum indicator.  It has been oscillating in oversold territory since early September!  We think this time the stochastic line has a great shot of going all the way up to 80 (overbought).  If that happens, QID will rally bigtime!  There is a powerful divergence between the stochastic and the price channel.  Look at the severely downsloped price trendline (red), compared to the stochastic lows (green line).  The stochastic line is flat to slightly sloping upward, indicating a change in trend.

“B“is the price chart for QID.  We had a powerful white candle on Friday (typically a selling day) and QID had a positive week overall.  More importantly, are the 3 and 10 day Exponential Moving Averages (EMAs).  The green and red arrows in the chart indicate buy/sell signals generated when the 3 day EMA (blue line) crosses up or down through the 10 day EMA (red line).  As you can see this technique gives wonderful stock trading signals.  The last signal (SELL) occured at the beginning of September.  Since then QID has gotten a 36% haircut! As of Friday’s close the 3 day EMA is EXACTLY the same as the 10 day and is just about to cross to the upside.  Monday could be an EXCELLENT entry point.

“C” is the MACD histogram.  Look at the massive bullish divergence between the histogram and the price channel.  This is a powerful buy signal.

“D” is the ADX indicator.  You get a buy signal when the green line crosses up through the red line (heading that direction but hasn’t happend yet).  However, the ADX line (black line) gives early signals.  The ADX line measures trend, and the trend has been up since early September, however that line is now rolling over and sloping down.

Bottom Line: Look for an entry point Monday and buy 50-100 shares of QID with a stop $1 below your entry point.

UPDATE: We had two wonderful stocks here in X (US Steel) and DGP (Double Gold ETF).  Hopefully you took profits and sold all of your shares now.

ERY:  We recommended it last week, but our stop of $29.20 was triggered.  However, ERY rallied hard on Friday and we really like it again as a trade.  Look to re-enter on Monday.