InCapta Inc (INCT): The Perfect Storm Is Upon GZFX GZFX T...

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fringe_remnant

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Sunday, 11/20/2005 1:04:31 PM

Sunday, November 20, 2005 1:04:31 PM

The Perfect Storm Is Upon GZFX

GZFX Technical Analysis notes and observations,
Sunday Nov. 20, 2005

The Perfect Storm, and a Golden Cross to Power It

GZFX has been drawing attention over the past month or so as it gears up to potentially become one of the 'penny story stocks' of 2005. One look at the charts is enough to convince even the most mild natured of investors at this level that excitement and raw power have mixed here to produce a phenomenon that is quite special. The stock is exhibiting explosive potential, wanting to break out, and in so doing, reinvent itself.

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These following are personal notes to myself, desriptive colour added for this publication. I find that if I sit down and formally review the TA on a stock I can nourish an unbiased point of view. If I don’t do this, then I will miss something, and my thinking will be muddy.

Every time I do this, I am always surprised. Something new is discovered that invigorates my thinking about a play, one way or another. For this review, I wasn’t disappointed….

As of the close Friday the stock had punched itself back up into an uncomfortable position hard under RRR (triple resistance) at 0.015. When I say uncomfortable, I mean that as this ceiling contains the PPS, the stock is inexorably being pushed from below by the strongest of forces.

A Golden Cross involving a 50 over 200 MA crossover looms directly ahead, only a few sessions away now.

Something has to give, and upon my TA Review today I have concluded that the dam will break in less than twenty-four hours from now. Here's how I came to that opinion...

The Review:

1./ Rate of Change

This momentum indicator will break the 100 line on Monday morning. It has been lagging because the PPS has been contained. Now it will demonstrate clearly where this stock is head, moving into strength and trend.

2./ Bollinger Band Width, and the Bollies themselves, for both Fast and Slow Settings

The BBW is an indicator of volatility based on the difference between upper and lower Bollinger Bands and is used to analyze the strength of a trend. As the play begins to develop, the BB’s expand, volatility increasing. The indicator follows this trend, and as it points upward and crosses zero, it signals trend strength.

The 20/2.0 Bollinger Bands on the GZFX Chart are expanding beautifully now, like opening flowers, the play spewing out of them like honey. Notice where the PPS is relative to the top Bollie line... Extremely bullish.

NOTE: The 10/1.618 Bollinger Bands are behaving differently. The bottom BB is pushing up from below. These close-in view bands, which are in a very aggressive upward attack, are contracting as they do this. Expect EXTREME UPWARD MOMENTUM to follow as this indicator resolves itself, this week.

The Bollinger Band Width indicators make it simple to follow the Bollie trend, and I place them beside ROC to allow these two functions comparative interplay.

3./ MACD (13DMA, 52DMA, 9EMA) Overall Trend

This indicator has been slowed right down to take out aberrations and indicate the Overall Trend in very simple terms. I love this setting. Confirmed now is the long slow development off the first push in the stock, and how it has never ceased building strength. That strength has reached a critical stage now. The stock can no longer hold back from moving forward, with this incredible power pushing from below.

MACD has generated, in GZFX, bullish signals from three main sources:

Positive divergence
Bullish moving average crossover
Bullish centerline crossover

The GZFX Overall Trend MACD is expanding and getting more positive each session, indicating in this case that the 13-day EMA is trading well above the 52-day EMA, and well above the 9EMA trigger line. A histogram appears in the view also.

The power behind this stock is being amply demonstrated via this momentum indicator as it oscillates itself into history here.

4./ MACD (5DMA, 10DMA, 4EMA) Local Trend

This indicator has been set to indicate the relative performance of the 5/10MA Oscillation to EMA4, affording an in-tight MA oscillating view of Local Trends, in very simple terms. I have included it now to monitor where daily trends, even hourly, are headed.

The indicator tells the same story as the Overall Trend MACD, with more aberrations, in this case. There is little divergence between the two here.

5./ The Accumulation/Distribution Line assesses the cumulative flow of money into and out of a security. I use this indicator in conjunction with ChiOsc. I have written about this phenomenon earlier in the week just past, and what it means for this stock.

The premonitions have been confirmed, and now the die is cast for the most spectacular of rewards. Again, notice the restrained ChiOsc settings, revealing the true story underneath.

6./ Williams%R Indicator and RSI.13

I believe that there is a very real possibility that we are getting into a situation on this stock that will be remarkable in its effect. I conclude with the review of these two leading indicators in conjunction with the foregoing analysis to come to this conclusion:

As background, again, it is confirmed that Money Flow and Accumulation of Shares are entrenched and developing immutable energy into GZFX as I write this.

RSI is in the +70 Power Trend Zone, developing characteristics that would see it possibly bouncing around in this overheated area, while the stock remains oversold yet appreciating.

There has been talk of the stock selling off soon, because of this overheated, overbought condition. Williams%R has been demonstrating this for days now. It keeps soaking up shares.

Technical Analysis Conclusion:

The phenomenon described above, supported by a wealth of technical indicators, is occurring during the most exuberant of shareholders buyin sprees on this stock in over three years.

The rate at which volume is expanding is incredible. At the same time, shares are becoming more tightly held.

The stock is getting ready to break out into fresh new territory, and throw off the shackles of the past, under the most volatile of conditions. The analysis above confirms that.

Final confirmation is made when one looks at the weekly chart. RSI there is about to crossover into the +70 Zone. The PPS activity is tightly channeling on that chart. No indicators are diverging negatively.

I don’t think the stock is getting ready to sell off. I think the EXACT OPPOSITE will take place, very, very soon.

A Perfect Storm has brewed, and is now upon the stock.

Hold fast.