Killeens Financial 

My current Favourites (AUG 2006)

AAPL.O (Apple Computers), BOOM (Dynamic Materials Corp), BZH (Beazer Homes USA) CMG (Chipotle, Mexican Grill), DGO.I (Dragon Oil), DWOG (Deep Well Oil & Gas), FBD.I, GM (General Motors), LIOX (Lionbridge Technologies),  MOT (Motorola), NTRI (Nutri, System), TRE (Tan Range Exploration Inc).

My current Favourites (Jun 2006)

On 12 May 2006, I identified Chapeau Inc (CPEU), Pacific Ethanol (PEIX), CanWest Petroleum Company (CWPC) and US Gold (USGL), as the best growth shares of the moment, (Chapeau having risen 700% and the other 3 averaging more than 200% since January).    No sooner had I made this selection than the May illness struck the stock market.  The Dow Jones fell a a few points, but my new favourites bombed!  Can West was down 40% by 18 May.  Not just the usual May dip, (see Stock Market Seasons), but a sustained Bear market!  Looks like this Bear Market will continue for a few months, and my Growth shares will be hit the hardest.  The ones that rose the highest fall the farthest!

USGL (US Gold)
CPEU (Chapeau Inc)
CWPC (CanWest Petroeum)
PEIX (Pacific Ethanol)
&
Dow Jones Ind. Ave.

Will they rise again?  I predict that there will be a false rally around the second week of July, followed by a return of the Bear until late October.  Then it will become clear that the market has over-corrected, and there will be a real recovery in November.  Will the recovery continue?  January will determine whether 2007 will be a Bull or a Bear year.

My present analysis of these four "favourites":

US Gold

Medium term prospect remains good, but the downward trend will continue for a while.

Trading on the swings now: sell @ 8.00; buy @ 6.00

Chapeau Inc

Medium term prospect remains good.

There seems to be resistance to fall below 1.25.

Swing trade buy @ 1.25, sell @ 1.50.

Reuters' recommendation: OUTPERFORM

CanWest Petroleum

Looks like the severe correction will continue until it bottoms at around 4.00.

Swing trade buy @ 5.00, sell @ 6.00.

Pacific Ethanol

It has fallen by 50% since 12 May! I reckon resistance should set in at 20, i.e., right now. I expect it to hop up and down off this line before resuming growth.  Buy @ 20 and sell @ 25!

Reuters' recommendation: BUY

What about my old favourites of last February?

How have they performed since then?

The following chart shows what happened to the "4 BUYS" in my table of "Money Doublers."

CPS.I (CPL Resources) has held its own, with a modest rise and fall back in May, but promise of growth in the second half of the year.

ACR (American Retirement Corp) and DGO.I (Dragon Oil), locked in loving embrace, failed to live up to their promise, until ACR bucked the trend and actually jumped 30% in May, while Dragon Oil fell back.  However, to sell at this point in time would probably be inadvisable, since a squint at previous years' charts show that both of these tend to shine in the second half of the year.

NTRI (Nutri Systems) wavered for a while and then improved significantly, making a dramatic rise when its exceptional annual returns were released at the end of April.  It, also, caught the May sickness, but seems to have recovered promptly  

And the following chart shows what happened to my "Grand Gamble" and a selection of others from my "Money Doublers."

Well, the Grand Gamble didn't pay off!  GTRE (Gran Tierra) fell from the height it had achieved in January to recover only a bit of the ground in April, before losing it again in May.

ALBK.I (Allied Irish Banks) went up about 15%, only to lose it all again by mid May.  I expect it to make 15% or 20% between now and next January, but in what months this rise will occur is unpredictable. Best bet would be November and January.

TLW.L (Tullow Oil) rose steadily, making over 50% before falling back in May.  It has abandoned two promising wells (read the reports in Reuters) and this might be a good time to take profit and run. Perhaps a slight recovery is on the cards first.

USGL (US Gold), the fastest growing share in the months leading up to February, has continued to perform exceptionally, making almost 200%, before falling back to 100%.   Technical analysis (18 May) revealed a troubling feature, as the recent peaks show a downward trend and the graph breaks through the Bottom Line.  Alas, the rise of US Gold may well be over! Alternatively, it may be that the rate of increase will just slow down. By the end of May, the growth trend seems to have re-established itself, at a gentler slope..

Notice that all these shares have followed the prediction of dropping in May (see Stock Market Seasons). This doe not appear to be just regular May sickness, but a reaction to recent U.S. inflation figures and the prospect of rising interest rates.