Welcome back to the trading week, fellow small cap fans! And, for those of you who've been acting on our suggestions, we've got a big update on one of our recent ideas. Remember Staffing 360 Solutions (STAF)? We gave you the scoop on this idea back on May 20th, explaining how this niche player in the cybersecurity arena was in the right place at the right time. The company has done quite a bit since then to convince us our initial opinion was on target, but today's news was a huge leap forward to that end. After the market closed on Monday, Staffing 360 Solutions announced its credit facility through Wells Fargo Bank has been increased to $15 million.
While the credit line hasn't been earmarked for anything specific other than for working capital, it's pretty reasonable to assume at least much of the liquidity is going to be used to facilitate more acquisitions for STAF... a growth strategy that's been working out quite nicely, by the way. Honestly though, I'm far more impressed by the lender - Wells Fargo.
Welcome to the weekend, fellow traders. And, what a week! Technically speaking, stocks broke under a major technical floor on Thursday but somehow managed to avoid a meltdown on Friday... despite the U.S. air strike in Iraq late Thursday. It's amazing what the market can ignore when it wants to. At a different time or in a different market scenario, the exact same news could have crushed stocks. On August 8th, 2014 though, it didn't matter in the least. Just crazy.
So what's next for the market in light of Friday's turnaround from what would have been a nasty meltdown? Well, that's just it. While we certainly delayed a bigger selloff, we're still not convinced stocks are going to be able to make higher highs without making lower lows first.
How was everyone's Thursday? Good, we hope. It wasn't a particularly good one for the market. In fact, it was particularly bad for stocks today. The bulls took their shot, but it was a weak one, not even giving the market a chance to test the ceilings we had in mind before dipping into the red ink. The thing is, today's relatively modest loss looks like the straw that broke the camel's back.
Above all else, the S&P 500 closed under it key 100-day moving average line at 1914 today, hitting a new multi-week low in the process. It wasn't a dramatic breakdown, but it didn't have to be dramatic to be damaging. Even though the volume behind the dip was light, the market just crossed a line. The VIX also put some renewed pressure on its resistance at 17.2. While there's always a possibility something could pull the market's fat out of the fire, the possibility is already remote, and getting further and further away.
Good Wednesday afternoon, one and all. As usual, we've got some thoughts for you on where the market is likely to be going. First though, there's another piece of business we need to take care of.
If you're reading this, then odds are you're familiar with an investing-oriented website called Seeking Alpha - a site mostly consisting of commentary produced by amateur investors and non-journalists. You may also be aware the Motley Fool established a similar blogging platform a couple of years ago, allowing anyone to post thoughts and observations about a particular stock or group of stocks. While open platforms like these are inherently going to invite some abuse, the editors of both websites did a reasonably good job of making sure all the posts that were syndicated were legitimate stories and not just some guy trying to inflate his stock's price. Oh, occasionally a questionable piece may have made it through, but by and large these media outlets were great places to find information the mainstream media wasn't offering... particularly about small cap stocks.
Welcome back, everybody. We hope you had a great weekend, and didn't dwell too much on Thursday's decimation. Yeah, it was a pretty harsh plunge, but it's not the kind of thing deserving of hysterics. Even if things deteriorate further from here though, we've got a basic plan and a lot of perspective... something the rest of the media seems to be unwilling to supply here.
We'll explain exactly what we're talking about in a moment. First, since we didn't get a chance to look at the data on Friday because we were telling you about Hydrocarb Energy (HECC) that morning, today we need to carve out a little time and take a deeper look at July's employment picture.