Hello Traders and thank you for taking the time to read through this article. You know, if there is one thing I love it's trading penny stocks and volatile ones at that.
Recently penny stock traders from all around have been scalping and swinging two highly promoted penny stocks in SNPK Sunpeaks Ventures, Inc. (SNPK.OB) and SEFE SEFE, Inc. (OTC:SEFE)
Sure these two stocks are probably frowned upon by many "small cap" investors but why should they be? I mean after all, they each have seen runs of over 757% and 294% respectively. So what is so wrong with that?
I guess small cap traders don't like the idea of "Stock Promotion" all that much, but if it offers an opportunity for "liquidity" then who cares right?
My take on this is although some penny stock promotion can lead to manipulation and even potential scams, at least the promotion offers traders like me an opportunity to get in and out quickly with medium to sometimes very large profits. I mean take a look at both SNPK and SEFE before they started their promotions and the stocks probably had and average of $20,000 traded per day, give or take. Then just on day one of the SNPK promotion the stock traded over 159 million shares between a low price of $.28 cents per share and a high price of $.47 cents per share. Tell me that's not liquid enough to get in and out of without worrying about damaging the stocks price.
Then SEFE kicks off its promotion and it seems anywhere from 3 million shares per day upward of 15 million shares per day on a penny stock that ranged from $.80 cents per share to a high of $2.96 most recently.
I just think its personally time to put down the "promotion is the devil" sign and at least be open to the idea that some promotion actually helps the stock and the shareholders.
Before I go, I would like to break down SNPK and SEFE based on the technicals and let you know what I see in the charts. First off, SNPK just saw a major pull back from $2.40 per share down to $.48 cents per share and is now seeing a smaller secondary run. With the price hovering around $.70 cents I would watch the $.75 to $.80 mental resistance points and the 20 moving average line which currently sits at $1.20 per share all as potential resistance points. With this being said, the supposed "one month" promotion on SNPK could very well be nearing and end and when the faucet is turned off on the mega promotions like this, then the share price tends to fade quickly. I could personally see this stock falling all the way back down to $.28 cents per share or even worse $.10 cents per share if the promotion goes completely dry.
SEFE on the other hand has mental resistance at $2 and $2.25 ahead and a previous high of $2.90s that could all act as resistance. If the stock pulls back then the 50 moving average line sits at $1.07 and the current 200 moving average line sites at $.90 cents per share.
For more details and up to the day updates on SNPK, SEFE and all the hottest small cap and penny stocks, please view this link.
As always, good luck and happy trading
Your, "Stock Analyzer"
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.