Dow Jones 13089.89 +135.95 4:21 pm PDT, April 25, 2007 NASDAQ 2547.89 +23.35 For info, visit access.smallcapnetwork.com S & P 500 1495.42 +15.01 Change your subscription status here Russell 2000 832.07 +5.71 VOLUME 07: ISSUE 43 A Cure For The Market's Summertime Blues For all of you getting ready to follow Wall Street's long-standing adage 'Sell in May and go away', you might want to rethink your plans. No need to cancel the trip to Disney World, but if you're planning on taking the summer off from trading, you may be missing some high-octane opportunities. Sorry Eddie Cochran, but there may actually be a cure for your summertime blues. More on that in a second.  In the meantime, if you're not reading our blog on a regular basis, then you're missing some of our best stuff. I think we pretty much touched every stock on our radar over the last few days in the blog. And more importantly, the blog is the place for you to post feedback and ask questions.  Just this week we've taken detailed looks at charts of Clearly Canadian (OTCBB: CCBEF), BioCurex (OTCBB: BOCX), and CEL-SCI (AMEX: CVM), a couple of which seem like they're itching to break out. We also looked at Stockgroup's (OTCBB: SWEB) consolidation zone - a much deserved break after gaining 75% from our pick price. We think a move above the top edge of its consolidation range could fuel another bullish leg. Check it out to get those details.  Back to the issue at hand, what would you say if I told you the 'seasonal weakness' pundits might be steering you wrong once springtime gets into full swing? You may be missing out on some great money-making trades.    The Data Don't Lie  I love data. Opinions can fallible, but data is undeniable. Check this out....  Over the years, investors seem to have collectively accepted that May begins a five month drought for stocks. The idea has a little merit, as you'll see, but it leaves out some information near and dear to all of us - the small and micro cap market. While large caps (and even the mid-sized stocks) do indeed tend to sleep through warm weather, small caps can and do generate some outstanding opportunities in the same environment.  To make a valid test of the idea, I wanted to compare the monthly returns of the S&P 500 (large caps), the Russell 2000 (medium-sized stocks), and the bottom 20% of all exchange-listed stocks (small and micro caps). The large and mid-cap data was easy enough to find. However, since the 'smallest 20% of stocks' tend to outgrow that criteria (or they get de-listed), we had to find a way to make ongoing adjustments to our data. Nonetheless, we were able to come up with a true small cap composite.  The nearby table tells the tale. Using data going back to 1993, we can indeed see how spring and summer look tepid.....for large caps. Frankly, I was surprised to see the mid-sized companies remain lethargic as well. However (drum roll please), the smallest of the small stocks didn't seem to suffer the same fate most of their larger brethren did.  The point? I think there are two. The lesser one is, never assume any 'common knowledge' is true or complete just because someone on TV says it is. The more important point though, is to make sure we're all willing to accept the reality if it turns out to be true again this year. Although this relative performance table is only an average of several years worth of data, it still leans decisively in favor of the small and micro cap market for the next few months.    But Why? Reasons for the overall summer weakness trend in large caps? Honestly, I tend to avoid rationalizing theories about irrational things - and I generally don't think the market is all that rational. (I rarely see stocks actually trade at what they're 'worth'.)  One thing I don't buy is the 'everybody takes vacations in the summer' theory. True, tourism and travel do ramp up beginning in May, but the degree of drop in trading volume once spring starts implies about 1/3 of all investors take a three-month vacation. Not likely.  Be that as it may, I do have an idea about the 'why' of the matter - I believe the market's usual weak spring/summer period is a self-fulfilling prophecy. Everyone thinks it's going to be weak because of the old saying - so they sell stocks when the weather turns nice (or at least avoid buying them). Of course, that very selling/avoidance decision causes the very weakness feared by the same folks.  At first glance, choosing to play along may seem silly. However, whether it makes logical sense or not, I'm only interested in owning stocks when and if I'm confident somebody is willing to pay more for them in the future. If investors probably aren't interested, and aren't going to be interested until October, my idea of what a stock should be worth is irrelevant. Hence, I don't spend my summers trying to squeeze blood out of a turnip.    The Same But Different So why wouldn't the same seasonal weakness affecting the big name stocks also affect small and micro caps? Well, that's my point....the 'common logic' isn't necessarily right - or at least isn't complete.  I see two possibilities in play here. The first one is rotation - out of larger names, and into smaller ones. However, I think this may be a minor influence....I just don't see the average 'large caps only' investor bothering to dig up some, or any, of the unknown names in the small cap universe. But, it's still likely to be a small factor.  The other possibility - and the one I feel better about - is that micro caps tend to march to the beat of a different drummer. Aside from being consistently better performers than large caps (albeit more volatile), smaller stocks don't ebb and flow with large cap names.  Regardless, my only goal was to share the data with you today, and let you determine the odds for yourself. The way I see it though, the odds favor small and micro caps for a few months, so I have no plans to put my portfolio on the shelf until October. Of course, we plan on being the ones to bring you these great trading ideas as they surface.      We Value Your Feedback   Got comments, questions or suggestions? Send 'em on over: Email the Editor If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 4653 Carmel Mtn Rd Suite 308 #402 San Diego, CA 92130 CCBEF's Chart: Calm Before the Storm? Did anybody else notice Clearly Canadian (OTCBB: CCBEF) shares saw their biggest bullish volume day in weeks on Tuesday? As most of you may know, Clearly has been one of our ongoing stories since before this time last year. Though it's had its ups and downs, we still can't help but keep coming back to its potential.  So what happened yesterday? They released some news about adding 7-Eleven to the list of vendors who offer their new Natural Enhanced Water line, which will put the product in about 1000 more outlets. To be honest though, I doubt that news is what spurred the buying. I think the upward move was (and no pun intended) mostly organic.  Like we said in Saturday's edition, CCBEF has been a roller coaster, but at least the 'ups' have been bigger than the 'downs'. I think eventually one of those ups is going to get traction - like it did in May and June of last year when the stock flew from $2.67 to a high of $4.55.  For more, click here.   Stockgroup Conference Call On Tap Everyone's invited to listen in on the Stockgroup Information Systems (OTCBB: SWEB) Q1 conference call at 4:05 PM EST on May 14th. They'll actually announce results about an hour before that. Still, we know from the Q4 call that there's a considerable amount of important information you can only get by participating in the call.  To join the call, dial 1-866-400-2280 a few minutes before the start time. If you're more of a web-based investor, you can join the online webcast following the instructions available at the company's website, stockgroup.com. Windows Media Player is required to access the online version.  For more, and a detailed look at the chart, click here.    Our CEL-SCI Vigil I gotta' say, I really like the way CEL-SCI (AMEX: CVM) is trading now. It was only about a week ago they announced a major funding deal in which all the buyers paid above the current market price for their shares. We got that initial pop in share price like we usually see after news of that ilk, but the real test comes afterwards - would the new uptrend has any staying power?  Our answer to the question is, take a look at the current chart. We're seeing new multi-week highs again (86 cents so far). What I really like though is the volume behind the recent move.  From here, I think the next big step is a move past 90 cents. If that level breaks as resistance, I can seriously see a breakout being made. Perhaps we'll see a repeat of the April 2006 surge, which by the way would have been practically impossible to jump into once it was started. In any case, we've got our chart alerts set to notify us once 90 cents is passed. It could get real interesting real fast.  To see the chart up close, click here. 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