ENW.VN -> EnWave, stock finding support, Signs deal will Kellogg Company

 Looks as if the price action is finding support of the original top channel of the Andrew's pitchfork.    If this holds Enwave stock is likely to move quickly regaining losses suffered over the last couple months.

A closer look with the MACD showing a rounding out, and looking to challenge the the 0.00 level.   Support also is from the 200 daily MA that is under the price currently.

In addition to the technical side, the company fundamentals are strengthening by the day.  Recently Enwave signed a R&D agreement with Kellogg company.  This is another milestone in the company's quest for additional partnerships with global leaders. 

EnWave website

  Explanation of EnWave Technology

ESSENTIAL ENERGY SERVICES LTD (ESN.TO) Follow up on the acquisition of Technicoil (TEC.TO)

 Essential Energy Services Ltd. (ESN.TO)


A few weeks after the acquisition and ESN has emerged with a general consensus that the addition of Technicoil will set Essential on a strong path of profitability.  The oil industry has heated up over the last 6 -8 months, with oil prices reaching around $115 at the end of April.  Many new drilling companies, production companies, and exploration companies realize that $100 oil is likely to be the new norm.  With this knowledge capital expenditures to improve efficiency, safety, environmental controls will be on every CEO mind.  The mid to small cap oil companies that are using the latest in equipment will not only realize immediate operational efficiency gains but also lasting goodwill in the form of adhering to a strict environmental standard.   This environmental aspect of the oil industry is even more important in the Canadian Oil Sands in Alberta. 

The EuroZone has been active it seeking cleaner energy, with targets set on the oil sands in Canada.  The companies that have stellar performance in the triple bottom line (financial, social, environmental) will secure drilling and production rights much easier as environmental concerns will be part of their culture.

Essential Energy Services is likely to capitalize on this inflow of "new" money as investment continues to pour into the energy and other commodities space.

From the latest move up, from 0.75 to 2.50, the price has come down 38.2% touching the 50 week moving average.

The downward sloping trendline once broken will likely start forming a base for another leg up as long as Oil prices remain stable.  Earnings will be what makes a stock like this move, as actual sales will outstrip expectations with money flowing into this industry.   I expect the 200 MA to hold, however, if ESN breaks to a new low expect slight further downside.


 

CIENA Update: Q3 Guidance cut, below analyst expectations

I have covered Ciena stock for the past few months, and have warned that something doesn't add up. In my recent more comprehensive review of this stock I warned of a roll over.  Also a orange trend line that was something to watch in the upcoming months.
With a June 8th, announcement that was not unexpected, Q3 guidance was cut to bring the stock back to a reasonable valuation.   Not so surprising is the gap over the orange trend line that has been extended.

Also not surprising is the sell off took the price back down to the May 2010 high around the $19 range. 
When the quarterly report comes out I will look deeper into their excessive levels of debt and future demand prospects.

Sino-Forest (TRE.TO) - Timber....... Trading Halted

What makes a stock fall 20% in a day resulting in halted trading?  --> This report by Muddy Waters Research

Looking at the front page of the Muddy Waters Research a proverb is quoted: "Muddy waters make it easy to catch fish".  The intro goes on to explain the mandate of the the company: Expose "sub-par" companies and illuminate "well-run and well-positioned" companies.  It appears there is a focus on Chinese companies.

The Muddy Waters report makes very strong allegations.  The first bullet point on the report says it all:
"Like Madoff, TRE is one of the rare frauds that is committed by an established institution."
The stock which traded north of $25 on March 31st 2011, has now come down to below $15.  Muddy Waters has a valuation of sub $1 on this stock. 

Muddy Waters has also just release a 34.1MB zip file with data to back up there claim.  This can be download from their link: here

News links below:
Sino-Forest shares plunge halt trading - BNN
Sino Forest plunges as short seller targets stock - Bloomberg
Sino Forest Shares Plunge 21%

Moved out of TSX: AXR (Alexco) into TSX.V: ENW (EnWave)

7.20 to 8.22, I decided that there is not much upside left so it was time to get out.  I will be looking for an entry point near the end of the week. 

EnWave has formed a base at 2.10-2.12 and is looking to move higher.  I will look for a small gain by thursday and exit while AXR pulls back.

UPDATE: exited EnWave at 2.10. As stock didn't look healthy enough to move higher.  Thursday close @ 2.03

Off Topic: My new Venus Flytrap's First Meal

A Venus Flytrap enjoying a meal (Carnivorous Plant)
This variant is a Dionaea muscipula 'Akai Ryu', Japanese for 'Red Dragon'

TSX: TEC - Technicoil Corporation - Weekly / Daily analysis

I thought I would branch out today and look at some Oil services / Equipment companies.  One reason I think equipment / services will do well is that the new exploration / production companies have had and will have amazing quarters.  This means there will be more free cash flow to spend on expansion projects, increase in cap ex.  Therefore even though the services / equipment players have had a run up, there earnings going forward will continue strong as production and exploration companies demand more support from third parties. 
TEC on the TSX looks promising.

Starting with the Weekly chart. This stock started to get attention in October of 2010 indicated by the volume increase.  The peak was in March and this pull back looks like a correct through time.  The Slow Stoch is flattening out and is in neutral territory, with the MACD descending but rounding out on the Histogram indicating a potential short term momentum shift. The stock is resting on the 20 MA Weekly.

On the short time frame (Daily), the stock looks very promising.  The MACD has crossed over and is pointing up. Some decent buy volume came in last week to hold above the 20 and 50 MA daily.  The one negative is the Slow stoch is over bought however if it states in this state for the next couple of days, this uptrend should be expected to accelerate.

Essential Energy Services Ltd. and Technicoil Corporation Announce Mailing of Meeting Materials for the Annual & Special Meetings

Today there is a meeting about a "proposed arrangement involving Essential".  Essential is listed as ESN on the TSX.

To read more check out this page.

If this proposal is a merger or acquisition, it could have a significant impact on the stock price.  From the above charts the upside potential is large with an easy stop location below the MAs on the daily. I currently owe a small stake in TEC and am looking forwarded the next couple quarters profits.