Hey Lou,
Basically I'm looking at cashing in on Cardiff Energy, which I bought in the $0.20 range, and investing in Nuva Pharmaceuticals. Any help would be much appreciated.
Laura
Hey Laura,
Thanks for the assignment.
I will conduct the research on Cardiff Energy Corp. (CRS) today and Nuva Pharmaceuticals Inc. on Friday. CRS explores and develops oil and gas in the United States with existing projects in Oklahoma. The shares have a market capitalization of $5.26-million and have to be evaluated as part of the the speculative portion of your portfolio. An examination of the company's financial statements indicates that there is still lots of work to be done to increase revenue and report profits.
An inspection of the charts will help identify how best to proceed with your holdings.
The three-year chart depicts a stock that caught a bounce in June of 2014 after a multi-year decline. The move higher took the shares from a 52-week low of $0.015 to a 52-week high of $0.29. By September of 2014 the stock was overbought and began to pull back to its current price level.
The six-month chart provides a close-up of the resistance along the downtrend line and the 50-day moving average. At the time of this posting there are no signals that the downtrend is about to reverse itself.
The six-month chart provides a close-up of the sell signals generated by the MACD and the RSI as the stock met resistance near the 52-week high. Currently the shares are meeting resistance along the 50-day moving average and the momentum indicators are signalling that investors can expect continued selling pressure.
Irrespective of what you intend on doing with the proceeds you should consider the risks you have assumed with this stock. Its a micro-cap that has not produced a profit recently and has enjoyed a sweet pop on a steady stream of news releases associated with its Bearcat #4 well. You mentioned that you are in at an average price of $0.20. At the current price you are underwater on your trade and as stated you're looking to cash in.
I have often advised that if your gut is telling you to sell then you should follow your instinct. When you go to cash even with when you are booking a loss you have removed your capital from the risk cycle and mitigated some of the pressure that could be clouding your decision making process.
Make it a profitable day and happy capitalism!
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