With part of the proceeds from ABK sale, I bought another bit stock. Not for investment, just like ABK wasn't, but for trade. More like gambling. If I lose, I lose. If I gain, I may gain big. (I did put in the stop so that I wouldn't completely lose.)
The stock is TLR, Timberline Resources Corp. It is a gold, silver and zinc prospector based in Coeur D' Alene, Idaho. I was watching the stock while it was spending the entire September around 70 cents, while the other gold miners advanced. Then it took off all of a sudden on Tuesday (10/6), and jumped to over $1.30 on Wednesday (10/7) on a gigantic volume for the company. Then it sold off for two days, and stopped at $1.05 on Friday before it rebounded back to $1.12.
The chart is a 3-year weekly chart to get some perspective, as the short-term daily is just too wild to figure anything out.
$1.30-1.40 looks to be a long-term support/resistance line, and sure enough the stock retreated when it hit $1.39. RSI and MACD showed positive divergence vis-a-vis stock price late last year and earlier this year. Slow stochastics at 60,3 (long-term trend indicator) has popped up above 20 for the first time since June 2008.
From the chart setup, the stock could go to $2.50-2.90 area. Point and figure chart of TLR says it may go above $4.
I bought it at $1.10 and put in the stop loss order at 87 cents, which is the September high. I think penny stocks are penny for a reason, and it is quite possible that my stop gets hit on Monday. If that happens, oh well. I will have still retained the profit (though reduced) from ABK sale.
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