PORTFOLIO UPDATE: AUTH IS A DOUBLE DIGIT STOCK IN SINGLE DIGIT CLOTHING
During the trading day Friday, I tweeted the following:
AUTH was originally initiated on May 8th, 2012 at 3.65 with a research report titled: "AUTH Represents A Substantial Opportunity In The Wireless Sector." Subsequently, on June 5th, I took a 37% profit for portfolios at 4.95 - 5. The stock got as high as 5.10 before moving back close to 4 and rebounding above 4.50 recently.
Those of you who have been observing my behavior as a trader/investor regularly know that I am a proponent of allowing profits to run. A great majority of traders/investors in today's environment cannot differentiate between digesting large amounts of diverse communication and sitting tight in a stock. That may have been a confusing way to put it. Let's try this: What it comes down to, at its essence, is that the vast information flow should not turn into a vast trading flow. You have to be able to digest the second by second bursts of information and remain confident in your position. There must be a discipline at work that allows you separate yourself from the Pavlovian instinct to simply cut and run just because a profit exists. Great years all come down to a few good trades or investments. All the rest is managing risk.
Ok. Now that my rant is finished, I will get back to AUTH. I would have normally allowed a 37% profit after one month to run. However, in the case of AUTH, there were signs that the price movement to 5 was climactic in nature. This became even more evident when rumors of the new IPhone using AUTH software began making the rounds. IPhone rumors for small cap companies are like Bigfoot. You get several sightings every year from guys with names like Billy-Bob and Kletus, with the occasional photograph of what is obviously a man with a gorilla mask, most often blanketed by a tree. But not once has Billy-Bob or Kletus called a news conference to showoff their catch.
Now that the dust has settled, it seems that AUTH is proving itself once again by looking technically stellar in the midst of a difficult market.
click chart to enlarge
AUTH
