What's PR Got to Do With It?

"PR" can mean a number things.

Typically, a PR (press release) is any news item that’s distributed by a company, concerned party, or publicist and is not actually written by, originated by, or researched by a real reporter and editor. Some companies keep their PR (public relations) division in house, but for bigger events they usually hire a big PR firm. The publicists and marketing geniuses (spawns of Satan) then try to get the word out about the company/event to the public. The PR (public relations) people do this by sending out PR (press releases) to everyone and their mother, with special emphasis on hounding the media.

In the normal media world, three things happen when a magazine/newspaper/TV reporter or news editor receives a piece of PR: (1) If they are wise, they throw it in the trash; (2) If they are not too lazy, they try to figure out whether or not there is actually anything newsworthy buried inside the flack-written fluff that is the basis of every PR; (3) If they are a regular, good ol' jurno hack, they try to figure out if they will be able to get any cool interviews or free electronics or movie/concert tickets or stock options or sex out of the publicist if they cover the “news” found in the PR; (4) The reporter/editor will research and verify (or contest) the info in the PR and then begin writing a story based upon the PR, bringing in outside research and doing interviews with people and trying to find the truth, unless they're FOX News or very drunk, in which case they'll just report the PR as fact or plagiarize it verbatim.

However, in the world of stocks, PRs are released directly onto newswires and are then avidly devoured by the public without ever being touched by reporters or editors, so anyone following the stock PR wires needs to do their own extensive DD (due diligence) to figure out what is really relevant and what is bullshit. With many PR wires, the company that wants to issue a news release just has to pay the wire service a fee, and then, bingo-presto, it’s posted online.

At the same time, the company in question and their publicity team may not actually be behind the PRs you see -- it could be the MMs (market makers) that have hired a PR team to release publicity items to help make the stock go up or down. Typically, stock-related PR found on the legitimate news wires will not be lies, per se, since people could get in trouble for distributing completely false information, but the info will likely be manipulated to the furthest extent the law allows, to help whatever party is releasing or paying for the PR.

But since the general media doesn't pay much attention to all the penny stocks out there, penny traders have to rely on PR to a great degree. And the PR, in turn, affects what the stock media reports on, what the stock bulletin boards talk about, and what the stock gurus recommend. And many of the stock-news services that release info on the wires and distribute info through newsletters and websites and spam are glorified PR firms in their own right – they’re paid (with money and/or stock) to recommend the stock they’re flaunting. Nonetheless, even when PR is mostly BS, it can still affect the PPS (price per share) or P/S (market cap divided by revenues, or stock price divided by sales price per share) and is rarely bad new (which is kept strictly on the QT). But you can use PR to your advantage if you’re on top of the news.

Penny Stocks Part 2: Bollinger is Not a Rock Band

Question: Swing trades, day trades, long-term investments. Exchange-Traded Funds (ETFs). NASDAQ, NYSE, AMEX, Pink sheets, and Over the Counter Bulletin Board (OTC BB) trades. Is it business or gambling? Can the small guy ever really win, or is the system rigged against the masses?

As part of my continuing attempt to find unique and insightful trading advice -- especially in the volatile world of penny stocks and -- I now present to you another post from the mighty Ric at the discussion thread “So how do I make money then?” at the Allstocks.com’s Bulletin Board.


Things you need to know

By Ric.

Best two pieces of advice for pennies:

1) Don't let people convince you that a penny is a long hold. You will get burnt. Buy low, sell high, and never look back.

2) Due Diligence.

Two things that you must learn about charts immediately are RSI (the relative strength index) and Bollinger Bands. They are so important. Now there is so much you can learn in charts that will help you make choices but I consider the above the most important things to learn for any investors. RSI will let you know if there is buying pressure or selling pressure. It will also confirm a run. Bollinger Bands also show price pressures and are used to support other indicators. There are links below under TA for education on understanding charts.

Relative Strength Index

Definition:

Relative Strength Index (RSI), an oscillator introduced by J. Welles Wilder, Jr., could be more appropriately called the internal strength index, for it compares the price of a security relative to itself. The RSI is based upon the difference between the average of the closing price on up days vs. the average closing price on the down days over a given period, and is plotted on a vertical scale of 0 to 100. An oscillator refers to a momentum or rate-of-change indicator that is usually valued from -1 to +1 or 0% to %100.

Wilder advocated a 14-day RSI, although shorter and longer periods have gained popularity when the market exhibits certain characteristics. Generally, RSI is measured in a period between 5 and 25.

Interpretation:

There are several possible interpretations for the Relative Strength Index, any of which can be very powerful depending on the market conditions and trading/investment approach: One interpretation is that buy signals are triggered when RSI is in oversold (20-30) area, potentially meaning that the stock is about to reach its low for this trend, and sell signals are triggered when RSI is in overbought (70-80) area, potentially signaling a market top.

A second mode of interpretation is to look for support and resistance lines or common chart formations such as head and shoulders in the RSI itself, indicating potential reversals that the stock chart may not.

A third mode of interpretation is to recognize divergences in the RSI, such as when the price is moving up when the RSI is moving down or vice versa. This can mean that the price is going to "correct" and move in the direction of the RSI.

A fourth mode of interpretation for the RSI is to view it as a bullish or bearish signal when it crosses 50. When the RSI crosses above 50 it can be considered bullish, and when it crosses below 50 it can be considered bearish.


Bollinger Bands


Definition:

Investors use trading bands, lines drawn above and below the moving average, to isolate a range of prices for a given security, based on the concept that a stock generally trades within a predictable range on either side of the moving average. When a stock is near the upper or lower limits of the trading bands is when an investor should pay closest attention, according to conventional wisdom.

Bollinger Bands are considered some of the most useful bands in technical analysis, for they vary in distance from the moving average of a security's price based on the security's volatility. During periods of increased fluctuation, the bands widen to take this into account, and when the fluctuation decreases, the bands are tapered for a narrower focus to the price range. The upper band is the standard deviation multiplied by a given factor above the simple moving average, and the lower band is the standard deviation multiplied by the same given factor below the simple moving average.

Interpretation:

The standard interpretation is that Bollinger Bands do not give absolute buy and sell signals, but instead indicate whether the price is relatively high or low, allowing for more informed confirmation with other technical indicators.

Bollinger Bands are typically drawn two standard deviations from a twenty day simple moving average for intermediate-term analysis, ten day for short term with 1.5 standard deviations, and fifty for long-term studies with 2.5 standard deviations. According to John Bollinger, for the most accurate average "choose one that provides support to the correction of the first move up off a bottom. If the average is penetrated by the correction, then the average is too short. If, in turn, the correction falls short of the average, then the average is too long. An average that is correctly chosen will provide support far more often than it is broken."

Mr. Bollinger also contends that:

Sharp moves tend to occur after the bands tighten to the average, when a stock is less volatile. The greater the period of less volatility, the higher the propensity for a price breakout.

When the price hits the upper or lower bands, it is suggested to confirm with other indicators whether that price movement shows strength or weakness, respectively, which could indicate a continuation. If indicators do not confirm this movement, it can suggest a reversal.

Tops or bottoms made outside the bands, followed by the same inside the bands, indicate a trend reversal.

A move originating at one band tends to go to the other band.


Resources for IQCharts & DD for otcbb and pinksheets


Try these two DD tools to be quick and good with your facts. At pinksheets in a matter of seconds under Company Info I can give you o/s, any r/s, company name changes, or planned changes and more. Quotetracker is a program you install on your computer. I wouldn't survive without it in a quick paced market. Tons of TA and FA with dd. Shoot pinksheets is my homepage on Firefox browser for quick reference. This is the first two places I go for fast due diligence.

www.pinksheets.com {Company Info tab is loaded with information} {SEC Filing Tab - wow} {News Tab - Pr's at your finger tips}

www.quotetracker.com - after you set it up add a symbol quickly then charts, news, research, and raw data at your finger tips. Great charts.

DD is mainly knowing where to go.


FA – Fundamental Analysis


www.pinksheets.com - first place to look!!!! Go to Company info for o/s. r/s, name changes, and many other facts. Go to SEC tab to look for filings. News tabs for latest news that may not show up through normal wire service.

www2.barchart.com - after you enter stock symbol select opinion to see trend spotter

www.otcbbtrader.com – otcbb loser/winner by volume, price, shares, transaction, and more

www.otcbbtrader.com/portal/n_letter/ gen/Microcap_Recap_Report.html - otcbb market recap on otcbb and pinksheet market for the day

tinyurl.com/9s2wr - DD site that is great.

www.otcbb.com – otcbb news

www.boardcentral.com/ index.php?view=Main – most popular stock search

www.smallcapcenter.com – otcbb resources

smallcapcenter.com/ tools_QuickSearch.asp?page=QUICKSEARCH.ASP - free filter

www.stockfetcher.com - stock filter

knobias.10kwizard.com - SEC Edgar filings


TA – Technical Analysis

www.stockcharts.com – charting web site

bigcharts.marketwatch.com – charting web site

www.iqcharts.com/education - TA, candlesticks, chart patterns education

www.stockcharts.com/education/ChartAnalysis - teaches chart analysis

www.transitionstrading.com/Chart_Studies.htm - teaching about charts


General DD (Due Diligence/Research/Fact-Checking)

www.allstocks.com/edu/index.html - Research links

www.quotemedia.com/results.php - Free level II (not pink)/Delayed

www.nasdaqtrader.com/aspx/regsho.aspx - “Sho” list

www.nasdaq.com – Tons of information (insider trading/IPO’s/Most active/much more)

www.tradetrek.com/online.asp - General but with 5 day and 6 month forecasts

www.secform4.com – Free real time insider trader monitor

www.otcbbtrader.com/portal/goto.dll - Market Data

www.stockmarketyellowpages.com – search tool

www.rookiedaytrader.com – Some good advise here

www.epubsinc.com/ index.php?pageName=formtypes – Edgar form types and descriptions

www.shellstockreview.com/ssrShellsBySym.htm - Shell companies

www.daytradingcoach.com/index2.htm - trading tips, education, quotes and charts

www.investopedia.com/ - dictionary of stock terms, tutorials

www.stockcharts.com/education/ MarketAnalysis/dowtheory1.html - theory of market movement

www.stockcharts.com/education/ TradingStrategies - well known trading strategies

our-street.com/home.htm - list of scam companies

www.sec.gov – latest filings, litigations, proceedings, or suspensions


————————————————————

Secretary of States (Protect Yourself!)

Alabama - arc-sos.state.al.us/CGI/ SOSCRP02.MBR/INPUT
Alaska - www.gov.state.ak.us/ltgov
Arizona -www.azsos.gov
Arkansas - www.sosweb.state.ar.us
California - kepler.ss.ca.gov/list.html
Colorado - www.sos.state.co.us
Connecticut - www.sots.state.ct.us
Deleware - www.state.de.us/sos/default.shtml
Florida - www.dos.state.fl.us
Georgia - www.sos.state.ga.us/default800.asp
Hawaii - www.ehawaii.gov/dcca/ bizsearch/exe/bizsearch.cgi
Idaho - www.idsos.state.id.us
Illinois - www.sos.state.il.us
Indiana - www.in.gov/sos
Iowa - www.sos.state.ia.us
Kansas - www.kssos.org/main.htm
Kentucky - sos.ky.gov
Louisana - www.sec.state.la.us
Maine - www.state.me.us/sos
Maryland - www.sos.state.md.us
Massachusetts - www.sec.state.ma.us
Michigan - www.michigan.gov/sos
Minnesota - www.state.mn.us/ebranch/sos
Mississippi - www.sos.state.ms.us
Missouri - www.sos.mo.gov
Montana - sos.state.mt.us/css/index.asp
Nebraska - www.sos.state.ne.us
Nevada - esos.state.nv.us/SOSServices/ AnonymousAccess/CorpSearch/CorpSearch.aspx
New Hampshire -www.sos.nh.gov/index.html
New Jersey - www.state.nj.us/state
New Mexico - www.sos.state.nm.us
New York - www.dos.state.ny.us
North Carolina - www.secretary.state.nc.us/ corporations
North Dakota - www.knowx.com/northdakota/ northdakota-corporate-records.jsp
Ohio - www.sos.state.oh.us
Oklahoma - www.sos.state.ok.us
Oregon - www.sos.state.or.us
Pennsylvania - www.dos.state.pa.us/dos/site/default.asp
Rhode Island - www.state.ri.us
South Carolina - www.scsos.com
South Dakota - www.sdsos.gov/index.htm
Tennessee - www.state.tn.us/sos
Texas - www.sos.state.tx.us
Utah - www.utah.gov/ltgovernor
Vermont - www.sec.state.vt.us
Virginia - www.soc.state.va.us
Washington - www.secstate.wa.gov/corps
West Virginia - www.wvsos.com
Wisconsin - www.sos.state.wi.us
Wyoming - soswy.state.wy.us/corporat/ corporat.htm


Phone Numbers provided by HitMe101


Knight Equity Markets, L.P.
NASDAQ TRADING
800-222-4910

NASDAQ TRADING
888-515-0031

BULLETIN BOARD
800-232-3684

DELISTING/BANKRUPTCY
212-336-8656

DELISTING/BANKRUPTCY
212-336-8791

DELISTING/BANKRUPTCY
212-336-8792

INTERNATIONAL
800-762-0271

BROKER/DEALER DESK
888-302-9197

INSTITUTIONAL DESK
800-222-4895

FOREIGN BULLETIN BD
212-336-8841

HELP DESK
888-931-HELP

NITE UBS Capital Markets L.P.
JERSEY CITY, NJ
N/A

DOMESTIC TRADING
212-514-5140

FOREIGN/ADR TRADING
212-804-3354

OTC BB/PINK TRADING
800-631-3094

DEALER/SALES TRADING
800-213-2923

TD Waterhouse Capital Markets, Inc.
OTC TRADING
201-369-8830

BULLETIN BOARD
201-369-8889

BULLETIN BOARD
800-500-3905

DEALER/INST SALES
201-369-1000

DEALER/INST SALES
800-369-5775

JEFFERIES & COMPANY, INC.
BULLETIN BOARD TRDG
212-336-7007

BROKER DEALER
877-350-2855

NASDAQ TRADING
972-701-3100

DALLAS TX
800-527-6816

AGENCY TRADING
972-701-3250

DALLAS TX
877-273-9728

LOS ANGELES
310-914-1163

STAMFORD CT.
203-708-5910

866-682-2398

INTL TRADING
203-708-5890

800-525-8620

877-350-BULL

LISTED TRADING
973-912-2790

CONVERTIBLES
203-708-5868

BROKER/DEALER DESK
212-336-7007

JEFF Tradition Asiel Securities Inc.
NASDAQ
212-791-4770

OTCBB
212-791-5335

VANDHAM SECURITIES CORP.
NEW YORK NY
212-223-7510

CloseVNDM 07:30
0.015 50 Oppenheimer & Co., Inc.
NEW YORK, NY
212-422-7813

CONVERTIBLE BONDS
212-668-5764

800-682-5381

NASDAQ/OTCBB TRADING
212-422-7813

LISTED DESK
212-668-8033

INSTITUTIONAL DEPT
212-943-9055
Hudson Securities, Inc.
JERSEY CITY, NJ
201-216-9100

JERSEY CITY, NJ
800-624-0050

JERSEY CITY, NJ
212-227-7733

INSTITUTIONAL SALES
800-419-9187

201-216-0375

COLORADO
888-576-1828

BOCA RATON, FL
800-898-2777

INTERNATIONAL
888-306-1998

561-361-0951

CANADIAN ARB
201-216-1475

WM. V. FRANKEL & CO., INCORPORATED
JERSEY CITY, NJ
201-434-5005

NEW YORK, NY
212-943-6633

NEW YORK, NY
800-631-3091

SEABOARD SECURITIES, INC.
NASDAQ/OTCBB
973-514-1699

FLORHAM PK, NJ
973-514-1500

AGENCY DESK
973-514-1678

JUNO BEACH FL.
561-630-6170

Hill Thompson Magid and Co., Inc.
JERSEY CITY, NJ
201-434-8100

JERSEY CITY, NJ
212-233-2200

NASDAQ TRADING
800-631-3083

ADR TRADING
800-879-9842

CANADIAN EQUITIES
866-235-7016

BANK STOCKS
866-291-6316

CHICAGO, IL
800-999-8073

CHICAGO, IL
312-372-3828

Maxim Group LLC
NEW YORK, NY
212-895-3680

800-261-0498

OTCBB
212-895-3874

FOREIGN TRADING
212-895-3897

INTL Trading, Inc.
ORLANDO FL
407-741-5399

800-541-1977

OTCBB DESK
800-327-5703

OTCBB DESK
407-741-5394

NEW YORK, NY
212-485-3545

Bear, Stearns & Co. Inc.
NEW YORK NY
212-272-4810

OTCBB/PINK SHEETS
212-272-4975

NASDAQ TRADING
800-247-7882

EMERGING MARKETS
212-272-9297

INTERNATIONAL
212-272-4580

ARBITRAGE
212-272-4506

PREFERRED
212-272-5104

PREFERRED
800-231-8892

CONVERTIBLES
212-272-4484

HIGH YIELD DEPT
212-272-5100

OTCBB/PINK SHEETS
212-272-4975

VFINANCE INVESTMENTS, INC
OTCBB/PINK SHEETS
800-487-0577

OTCBB/PINK SHEETS
561-981-1314

NEW JERSEY
908-782-4469

NEW YORK
908-782-4469

PHILADELPHIA
856-234-2900

PERSHING TRADING COMPANY, L.P.
JERSEY CITY NJ
201-413-3531

NASDAQ TRADING
800-305-0161

BULLETIN BOARD
201-413-2700

DEALER DESK
201-413-2465

866-880-9410

Fulcrum Global Partners LLC
OTCBB DESK
212-803-7046

OTCBB BROKER/DEALER
212-803-7070

CANADIAN/FOREIGN DSK
212-803-9026

Sterne Agee Capital Markets, Inc.
BOCA RATON, FL
561-368-8373

BOCA RATON, FL
800-930-3536

DEALER SALES, FRANK
800-979-4568

DOMESTIC SECURITIES, INC.
EDISON, NJ - OTC
732-661-0300

MONTVALE, NJ OTC
201-782-0009

MONTVALE, NJ HQ
201-782-0888

BILTMORE INTERNATIONAL CORPORATION
TRADING DESK
732-791-4000

ALTERNATE
732-287-6535

—————————————————————————

Recovering a Loss

Loss vs. Gain-Needed-to-Recover-the-Loss

10% - 11.1%
20% - 25.0%
30% - 42.9%
40% - 66.7%
50% - 100.0%
60% - 150.0%
75% - 300.0%
90% - 1000.0%

Timing your entry and exit from the market is critical to making money and controlling losses.


MM Signals

100 > I need shares
200 > I need shares badly but don’t take it down to get them.
300 > Take the price down to get shares......
400 > Trade it sideways based on Supply and Demand
500 > Gap one-way or the other, usually to the direction of the 500 trade. Sometimes -if in the middle -keep the price right where it is.

Invest with your brain not with your heart. — Ric

****

Check out the Spam Stock Tracker project. -- L.B.