When it comes to finding attractive bullish small cap stock picks with high growth, strong earnings, and that are deeply undervalued, there’s no better place to do your stock hunting than in the Chinese small cap arena. Back in 2007 and early 2008 we were able to gain substantial profits playing Chinese small cap stocks and now that the dust has settled with the recession there is an abundant amount of small cap chinese stocks grabbing my undivided attention. My favorites that I have spotted so far are CHLN, CMFO.OB, CHTL.OB, CPQQ.OB, and LPIH.OB. I have substantial positions in all of these.

Small Cap Stock Pick: CHLN

China Housing & Land Development, Inc., through its subsidiaries, engages in the acquisition, development, management, and sale of commercial and residential real estate properties in the People's Republic of China.

CHLN has been a huge favorite of mine for the past

Shiner International, Inc. (BEST), through its subsidiaries, engages in the research and development, manufacture, marketing, sale, and distribution of packaging film and color printing for the packaging industry.

BEST has been making some big moves in price action as well as in the business world. Recently BEST signed a significant deal with the largest meat product manufacture in China with potential of contributing nearly $586k in monthly sales for the company.

Quote from Mr. Jian Fu, CEO of Shiner:

“Our business relation with Shineway is an important development in our market and customer expansion of coated, food-safe packaging film. We believe this is a significant development in our growth in the current economic climate, enabling us to take advantage of the new Food Safety Laws as we had expected. With the positive economic indicators in China and implementation of more stringent food safety laws, the Chinese demand for our state-of-the-art

China Ritar Power Corp., through its subsidiaries, designs, develops, manufactures, and sells lead-acid batteries under the Ritar brand in China and internationally.

Its nice too actually see some forward growth estimates after a long period of companies' futures at the brink of failure; it was difficult to find any positives or value in small cap companies other than through technical analysis which is my expertise at ttt.net.

China Ritar Power (CRTP.OB) is another battery company making moves in the smallcap arena alongside others which have been performing very well recently: A123 Systems (AONE), China BAK Batteries (CBAK), China Sun Group High Tech (CSGH.OB), Axion Power International (AXPW), and C&D Technologies (CHP) to name a few. CRTP is the most attractive one of the group to me from a fundamental and a technical perspective.

Lets take a

The market continues its bull ran as the DOW ran to new recent highs Monday to close at 10,090. As the market continues to rally more and more bullish stock chart setups are popping up on my scanners. Here are 3 stocks that haven't yet broken out from their chart patterns but all have great potential if these trigger prices are hit to spark the breakout momentum.

Small Cap Stock Pick GSI:

General Steel Holdings Inc., through its subsidiaries, operates a portfolio of steel companies serving various industries primarily in the People's Republic of China.

Current year EPS: .28
Next year EPS: .57
+103% estimated growth

Current year revenue: 1.64b
Next year: 2.24b
+36.6% estimated growth.

Forward P/E: 7.61x
Industry P/E: 16.82x

Fous Fair Value: 9.58
Current share price: 4.34
+120% upside potential

Technical Analysis:

Small Cap Stock Pick ARM:

ArvinMeritor,

Oil and gas stocks have been hitting my stock screens the past week or two as oil has been on the rise and light crude is setting up a very bullish looking chart pattern with some big upside potential.

Checking out USO’s chart, which is the ETF of the US OIL FUND traded on the NYSE is practically a mirror image of the Light crude futures commodity, we’ve got a very bullish ascending triangle pattern setting up here with lots of upside potential. I think we could expect USO to hit up the $60 range over the next several months based off of this chart pattern.

Technical Analysis: (Click to enlarge)

2 Small Cap Stock Picks I’m long in for the Black Service Portfolio : BQI, EXXI

EXXI: Long @ 1.88

Energy XXI (Bermuda) Limited, together with its subsidiaries, engages in the acquisition, exploration, development, and operation of oil and

I’ve been watching in bewilderment at how much airline stocks such as UAUA, AMR, DAL, LCC, and RJET have have rallied without any real profit taking to set in yet. I shorted RJET a few times mostly for profits as I’m looking to catch this on the down side once people start taking there profits. And it's not a matter of if this will happen, it's when. With every huge sector rally, there's always a point when it peaks and retraces a significant amount before it continues going up, levels, or continues to fall.

OPEC scheduled an emergency meeting for Friday, October 24th, and is expected to cut crude oil output by an unknown amount. Demand for oil has been on the decline which has led to oil dropping around 55% from its peak near 150. Falling oil prices has meant increased profits for airlines, which is why the airline

The best way to find to make loads of money in the market is to find the hidden treasures before the mob has found them, the stocks that you can get into before they are in the public eye and blow up before you can get into it at a fair price. One way to find these kind of stocks are to scope out the OTCBB stocks before they are traded on the major exchanges, such as stocks like China Direct (CDS), which I found while it was trading as a bulletin board stock and purchased in the $3 area and noticed its value and growth as a hidden treasure stock.

Here's my original article on CDS and CHND.OB, here at Seeking Alpha back in May 07. I eventually sold this stock for a 150% gain after it was trading as a stock on the Nasdaq exchange. Another example

Small Cap Stock Pick #1: Aladdin Knowledge Systems (ALDN)

ALDN broke out from the horizontal resistance mark around $10/share Monday on heavy volume in the face of a collapsing market. This breakout suggests a possible move to fill the gap in the low 13 area which implies a possible 30%+ potential gain here. Looking at ALDN's numbers, the company expects some very strong earnings growth, nearly 75%, in 2009, which is quite significant as we don't see these kind of estimates very often in this weak economy. Analysts are expecting $0.68EPS in 2009, which gives ALDN a future fair value among its industry peers of $16.10/share compared to its closing price of $10.17 on Monday. I'm long at $10.06.

Small Cap Stock Pick #2: Overhill Farms (OFI)

OFI has been making a huge run in 2008, starting off the year around $2.50 and currently closed at its all time high

It's been a while since I found one of these great Chinese stocks that were so easy to find months ago (back then, it was like trying to find a piece of hay - in a pile of hay). Since Xinyuan’s (XIN) IPO in December, the trend has been in bear mode as the market has faced credit and housing issues all year long lead by the U.S., which hasn’t been in favor of upside movement for stocks. I’m not one to call a bottom in the housing sector by any means, but there are always short squeezes and short term opportunities to capitalize on in depressed stocks on the long side.

Fundamentally, XIN is deeply undervalued within the residential construction industry, carrying an extremely low forward price/earnings ratio of just 4.38x, compared to the industry average of 26.67x. For the recent fourth quarter, XIN posted strong results with

First stock we're gonna take a look at is Emergent Biosolution (NYSE: EBS). Fundamentally EBS looks strong as it carries a low forward P/E ratio of just 8x earnings on estimates of 1.06 eps in the year following. Currently the Biotech industry is trading at a much higher mutlitple of 26.06x making EBS look fairly cheap among its peers of biotechs. We could suggest a fair value for EBS of 27.60/share found by multiplying the forward earnings of 1.06 by the 26x industry average earnings multiple. This gives us plenty of room to capitalize on a trade with todays closing price of just 8.53:

Technical Analysis: After breaking out from its bearish descending channel EBS has made a strong run topping it off with todays strong rally on increased volume. Price is down AH and I expect some profits to be taken warranted its overbought. I

China Agritech (CAGC.OB) is engaged in the development, manufacturing and distribution of organic liquid compound fertilizers and related products in the People's Republic of China. The company has developed proprietary formulas that provide a continuous supply of high-quality agricultural products while maintaining soil fertility. The company sells its products to farmers located in twelve provinces of China including: Heilongjiang, Hebei, Liaonong, Jilin, Shandong, Inner Mongolia, Henan, Sichuan, Guangdong, Xinjiang, Yunnan and Guizhou. For more information visit their website.

Yet again we find ourselves in a position for speculation in China. Fertilizer stocks rallied across the board yesterday with Canada's Potash (POT) leading the industry hitting record highs Thursday to close at $114.58 after reporting a 67% rise in earnings as demand for fertilizer is rising in developing countries. "Fertilizer producers continue to post impressive results, as agricultural conditions globally are very strong," Goldman Sachs analyst Edlain Rodriguez wrote

Based in Xi'an, the capital city of the Shaanxi province in China, China Housing & Land Development, Inc. (CHLN.OB) is the largest Private developer of residential and commercial properties. China Housing has been an independent business since 1992 and became a U.S. public listed Company in 2006. The housing market has been growing quite rapidly in China over the past few years as China as a whole has been expanding greatly. CHLN has been around for a while and is also expanding its revenues and income very rapidly and are expected to continue into 2010 with huge future projects that will provide steady growth in earnings.

History: Information from Roth Capital presentation:

-Largest private residential real estate developer in Xian City, Shaanxi Province, China.
- From 1999 - 2006 sales grew from 2.4m to 54.1m in 06' with net income of over $9m in 2006.

GlobalSCAPE (GSCP.OB), a provider of Global Managed File Transfer [MFT] solutions and wide-area file services [WAFS] technologies, delivers a modular approach to solving the enterprise challenges of security, bandwidth, latency and regulatory compliance. GlobalSCAPE’s products securely and efficiently move files such as financial data, medical records, customer files, intellectual property, and other sensitive documents of any size between supply chain partners and branch offices. GlobalSCAPE’s products are used by mid-sized and large enterprise companies, including virtually all of the Fortune 100, leading technology, banking, healthcare, and public sector organizations. Headquartered in San Antonio, Texas, GlobalSCAPE is also the developer of CuteFTP, the most popular file transfer protocol application on the market.

Fundamental Analysis:

GSCP has experienced a large amount of growth from 2004 - 2006, with an 800% increase in net income over the course of those two years, which explains why its share price has increased from a slim

Hoku Scientific (HOKU) has been a very speculative stock over the past year as it gained awareness amongst investors due to orders from larger companies. They recently announced a huge contract with SunTech Solar (STP), in which Hoku will supply SunTech with ten year's worth of polysilicon, for an estimated $678 million. After Thursday's close, the company announced another contract, with a subsidiary of Solar-Fabrikworth, for approximately $185m.

HOKU seems

China Natural Gas, Inc., (CHNG.OB), is the first China-based natural gas company publicly traded in the US. It currently owns and operates a 120 kilometer long compressed natural gas pipeline in Xi’an, China, a fast growing Chinese city supported by a population of approximately eight million and is the “gateway” to the broad Western regions of China. CHNG has three profitable business segments: end user delivery of natural gas services to residential, commercial and industrial customers; wholesale natural gas to retail natural gas filling stations; and retail natural gas at company-owned natural gas filling stations. The city of Xi’an has approximately 20,000 Taxis, 3,000 buses and 2,000 special purpose vehicles that are powered by compressed natural gas.

I’m quite certain I've posted CHNG.OB in bull mode several times, though for some odd reason I never went further than looking at the chart and saying to myself , “hmm, interesting. I’ll

ShengdaTech (SDTH) is engaged in the business of manufacturing, marketing and selling a variety of nano-precipitated calcium carbonate ("NPCC") products and coal-based chemicals for use in various applications.

The Company converts limestone into NPCC using its proprietary technology. The unique chemical and physical attributes make NPCC a valuable ingredient in tires, paints, polyvinyl chloride ("PVC") building materials and other products. NPCC enhances the durability of many products by increased strength, heat resistance, and dimension stabilization.

The Company is also engaged in the manufacture and sale of coal-based chemical products namely ammonium bicarbonate, liquid ammonia, melamine and methanol. The Company markets and sells its coal-based products mainly for chemical fertilizers and raw materials in the production of organic and inorganic chemical products, including formaldehyde and pesticides.

Fundamental Evaluation:

SDTH had a very strong first year reporting as a publicly traded company, posting some impressive earnings. For FY 2006 they posted revenues

China Direct, Inc. (CHND.OB) maintains active, majority stakes in a diversified portfolio of Chinese companies, in addition to offering consulting services for both private and publicly traded Chinese entities. According to the company's website:

China Direct provides a platform to develop and nurture these entities as they expand their businesses globally. As your direct link to China, our Company serves as a vehicle to allow investors to directly participate in the rapid growth of Chinese economy in a diversified and balanced way.

CHND is relatively new to the OTCBB market, having debuted in November 2006, and is currently trading on relatively low volume. Yesterday, CHND released their Q1 earnings report with some impressive numbers, especially after some promising acquisitions made in October 2006 (see conference call transcript). Revenues increased from $206k in Q1 06' to $30m this quarter.

"The increase in revenues was mainly attributable to the

Puda Coal (PUDC.OB) has had a really rough last year as it dropped from a high near $6/share to a recent low of just $.75/share last month. Nevertheless, Puda looks to be making a strong comeback; their last two quarters reported were profitable on increased sales and they posted income of .16eps for FY 2006.

2006 Highlights from PR on Tuesday April 17th:

Fourth Quarter 2006 Highlights

Fourth quarter revenue reached a record $ 43.4 million, up 110% from the fourth quarter of 2005

Operating income totaled $7.1 million, up 78% increase from the fourth quarter of 2005

Net income rose to $6.0 million, or $0.07 per fully diluted share

Adjusted net income totaled $4.0 million, or $0.05 per diluted share, up 60% from adjusted net income of $2.5 million in the fourth quarter of 2005

Sales of cleaned coal totaled 548,000 metric tons [MT], up 105% from the

NUCON-RF (NNRF.PK) is a US Corporation with an international business model. The Company has executive offices in Washington, Berlin and Moscow. NUCON-RF provides product, technical and engineering support for the nuclear power industry and is addressing environmental and power quality solutions for the governments of Germany, Russia, CIS and multilateral institutions, including the G-8 and the European Bank of Reconstruction and Development.

The mission of NUCON-RF is to provide cutting edge environmental safety solutions for the nuclear waste management and power quality challenges facing the Russian, European and Asian markets.

Current solutions include:

Safely shielding, encapsulating and storing a broad range of radioactive and other toxic wastes

Protecting & improving the performance of electrical equipment throughout industrial, commercial and residential facilities by eliminating power surges and high frequency noise

Energy demands are on the rise and our typical resources are depleting, resulting in the world looking for alternative energy

Breakwater Resources Ltd. (BWLRF.OB), incorporated in 1979, is a base metals mining company that produces zinc, lead, copper and gold concentrates.

Primarily it looks like they mine zinc though produce silver, copper, and gold as well throughout the year. All the resources I used placed them under the gold and silver industry, though I compared them to the metal mining industry as well.

BWLRF growth in eps in 2006 has been quite amazing. In the years 04 and 05 BWLRF managed to squeeze out some profitability reporting .01 and .04 for 04' and 05'. In Feb they reported their full year 2006 results with .37eps which was a 825% increase in income from 2005 to 2006. BWLRF is managing to sustain this sudden rise income and are expected to grow to an annual .50 eps for 2007 and .60 eps for 2008 with increased heavily revenues. It appears that things