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Chart of the Week - Aug 18, 2008

 I-Remit, Inc. (I)

I Weekly Chart - Testing Medium-term Resistances 

charts are courtesy of Metastock

I Daily Chart - Trending Up Strongly but Already Quite Overbought

charts are courtesy of Metastock

Legend: blue lines - range for Tsupiteros

            dotted blue lines - range for Position Traders

            red lines - important trend lines

I-Remit, Inc. (I) has been climbing up steadily in the last few days despite the correction already happening in the second and third line sectors. I don't know what's going on in here but there definitely has been a pickup in its volume in the last two weeks, thereby, indicating some accumulation going in the stock. What can we expect from I in the next couple of days, if not weeks?

Since its debut in the stock market has October 17, 2007, the stock has done nothing but drop. Obviously, the downtrend of the whole market has a lot to do with the stock's downtrend from its peak at 5.90 on its listing date to 2.50, which was registered last June 27, 2008. For those who bought the stock's IPO at 4.68 and was able to sell in the first few days of trading, lucky you. But for those who bought the stock's IPO or who bought the stock in the first few days of its trading, you are probably quite concerned of your positions in this stock right now and are thinking to yourselves whether you will still be able to get back your investments in this stock or not. Surely, because of its movement in the last few days, you have become hopeful once again.

There's not much to speak of with regards to the long-term prospects of the stock, that is, if we base it only in its chart. Since the stock only listed in the market last Oct 17, 2007, it has yet to even reach one-year's worth of data that we can analyze. I'll just have to make do with what we currently have. Notice in the weekly chart of the stock above that its downtrend has slowed down already and prices are now moving sideways. In fact, the close of the stock this week is the first time that it has actually registered a higher high in the chart eversince it trended down last October. Could this be a sign that prices are now going to start trending up from here? That is certainly possible but, at this point, it's just too early to say. For a bottom to occur in its weekly trend, prices must first convincingly breakout above its medium-term resistance at 3.75. However, with the stock already closing at exactly 3.75 this week, some are now quite optimistic that the stock will be able to breakout above its medium-term resistance this coming week already. This week will be critical for the stock. If the stock can convincingly breakout above its medium-term resistance at current levels, the stock may be able to climb up to as high as 4.50 or even 5.00.

In the short-term, you can see that prices have already been trending up for quite some time now and is now testing its resistances at current levels. With the stock still forming a long white candle last Friday and still closing the day at its highs, chances are that the stock will continue to climb higher on Tuesday. I'll be damned though if prices still climbs up by another 0.30 on Tuesday. At the very least, I expect prices to probably consolidate first for now.

Tsupiteros, who currently have positions in this stock, are recommended to just hold and use a break below 3.50 as your mental stop. I would not suggest Tsupiteros to buy this stock anymore at current levels unless prices drop back down to around 3.30 to 3.50. For those who would like to take profits, you may want to do so as close to 4.00 as possible. For Position-traders, you may want to buy it as close to 3.00 as possible or on the formation of its next higher low, presuming of course that it does form a higher low.

Notes:

Short-term Traders/Tsupiteros vs. Medium-term/Position Traders: Recommendation for short-term traders or Tsupiteros are meant to be used by traders whose holding period are limited to one day to two weeks. Medium-term or position traders are meant to be used by traders whose holding period are two weeks to three months. Long-term investors whose holding period is more than three months should not follow these recommendations.