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How To Find Opportunity (& Not Get A Headache)
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February 2, 2024

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Dow Jones 13360.26 -185.58 1:12 pm PDT, June 22, 2007 NASDAQ 2590.30 -26.66 For info, visit access.smallcapnetwork.com S & P 500 1502.58 -19.61 Change your subscription status here Russell 2000 833.20 -6.61 VOLUME 07 : ISSUE 60 How To Find Opportunity (& Not Get A Headache) I hope all of you routinely read all of our commentary, as opposed to just our e-newsletters regarding small cap trading ideas. Why? If you've recently absorbed all of our stuff, then odds are you've also taken a way a few great ideas and made some very good money with them. If you haven't, don't worry - we plan on covering all the market's opportunities (regardless of the company size) indefinitely.  Just to illustrate how our site can be a complete investing resource, I want to highlight some of the best non-small-cap ideas I still think have a lot of potential. The quirk is, none of these names or ideas were e-mailed to you when we published them - they were exclusively found in the articles you can only read at the website.    Trader's Corner If you like ideas served up to you on a silver platter, then the Trader's Corner may be for you. The ideas are specific, complete with what we believe are appropriate targets and stops. We've put out 14 ideas since the column was started in September. As of today (counting closed trades and using the current price on any open trades), we've found 11 winners. In fact, some of them were pretty darn big winners.....Incredimail (NASDAQ: MAIL) is up nearly 22%, while China-Mobile (NYSE: CHL) is up by more than 20% in less than three months.  From the names we've mentioned in the Trader's Corner, I still like the following:  Sprint-Nextel (NYSE: S) - We first looked at Sprint-Nextel on February 28th, right in the midst of a huge correction. So, we're actually pretty happy to be up 15% since then. More importantly, I think this stock has some more upside left to go. We originally suggested a target of $24.00, which was almost reached with June's peak of $23.42. However, the pullback to the current level of $22.10 may have bled off enough pressure to allow the next bullish leg to carry shares even past $24.00. We're going to play this one by ear, but I like the way the stock has built a base near $21.80 over the last several days.  Ford (NYSE: F) - There's certainly nothing small about this name. We mentioned Ford in the April 30th edition of the Trader's Corner. The 10%+ move since then is nothing to sneeze at, but a closer look at the chart shows me something potentially even more exciting.....a possible breakout. The $9.00 area has been a ceiling for weeks now, and months if you wanted to get technical about it. For that matter, you could justify the $9.00 mark being resistance for a couple of years, at least based on weekly closing prices.  Regardless, after making several higher lows, we have to wonder if Friday served as the beginning of a breakout move. If the market can get comfortable with seeing Ford shares above $9.00, I can see this one potentially launching like a rocket. After all, there aren't any barriers left I would consider meaningful resistance. Our first suggested target was $10.00, but like Sprint, we may end up raising the bar.  Intervoice Inc. (NASDAQ: INTV) - This one's a new idea, first studied on May 21st. It deserves an honorable mention in terms of future upside potential. Though it's been flat the last couple of weeks, the longer-term momentum may be on the verge of kicking in again, now that the 20 day moving average line has caught up with the chart and can start offering support once more.    Heating Up Our Heating Up column examines the important market trends without necessarily looking at specific companies. If you want some fresh perspective on growth versus value, large cap versus small cap, industry trends, sector rotation, and regional/geopolitical opportunities, then Heating Up is something you'll probably want to review regularly.  Though the column isn't focused on individual stocks, it doesn't mean it's not actionable - it might just take a little extrapolation. Take our March 13th edition for instance....'Are Better Bets Abroad?' In it, we mentioned four overseas markets we felt had the potential to outperform U.S. stocks. They were the Australian, Indian, Latin American, and Russian markets.  Since then, the U.S. stock-based Russell 3000 is up by 9.4%, Not bad, but think about this....three of the four exchange-traded funds corresponding with each of those countries we discussed actually performed better than the Russell 3000 between now and then. The iShares Australia Index ETF (AMEX: EWA) is up 19.5% during that time, Barclay's iPath India ETF (NYSE: INP) is up 27.4%, and the iShares S&P Latin America 40 (AMEX: ILF) is up 30.9% since then. The Van Eck Global Russia ETF (NYSE: RSX) didn't come along until late April, but the Russian Trading System Index (RTSI) is up 4.3% since then.  As for some of the Heating Up ideas I still think have some life left, I don't see a need to go back any further than last week's edition - it was another look at international ETF trends.  The iShares Hong Kong Index ETF (AMEX: EWH) is one of the few that actually hasn't done super-well lately, which is what I like about it - it could be closer to the beginning of a move than the end of it. Conversely, the iShares Mexico Index ETF (AMEX: EWW) has done exceedingly well. The reason I like its chances going forward are simply that it has done exceedingly well in an exceedingly consistent manner. The run will eventually wind down, but I don't think it will be next week when it does. I could say the same thing about the iShares Australia Index ETF (AMEX: EWA). With all of that being said, I do want to point out this much international focus is probably a rarity. More often than not, the Heating Up column will be centered on U.S. markets; it's just that overseas markets have been very strong of late. When that changes, so too will the topics.  And speaking of, I want to remind you of a macro-theme we looked at in November of last year. In a nutshell, the overall market consensus was 'growth' would top 'value' in 2007. I disagreed. Well, year-to-date, the S&P Barra Value Index is up 6.9%, while the S&P Barra Growth Index is up 6.4%. I'll call it a tie. Looking forward though, I still believe value is better positioned for gains than growth is. And yes, I feel small-cap value still offers the biggest upside potential of all.    The Bottom Line Is....Well, The Bottom Line So has the Small Cap Network turned its focus away from the world of small cap stocks? Not at all. We still firmly believe in the power of mostly-unknown companies, just as we're firmly committed to being a resource to bring those ideas to you. In fact, I should probably tell you.....we expect to have a pretty exciting update for you on one of our focus small-cap companies this Monday.  Simultaneously though, we also believe in balance. We all actually have the exact same goal - the best bottom line we can create. If that means the occasional ETF or large cap, so be it.  The key point I wanted to make today was just this - we hope you're using the site to its fullest potential. To do so, you may want to check in on the home page articles from time to time. This includes our Market Wise and Technology Trends columns as well. I suggest bookmarking the site by clicking here. Then, just hit the 'Favorites' button on your browser, and click the 'Add' button.  Have a great weekend.      We Value Your Feedback   Got comments, questions or suggestions? 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