Wednesday, December 13, 2006

STEM...$9.50 Price Target?




If you look at the above weekly chart of STEM, you will see a very clear and obvious 21 month cycle that has been nailing the lows of this stock since 1999.. It appears that the last 21 month cyclical low was made this past June.. If you average the rally of the last 3 cyclical lows you get an average price increase of about 450%.. I'm not going to include the 1999 - 2000 rally because that was a crazy move. If we add 450% to the June low of 1.77 we get a price target of $9.50! It seems hard to imagine the stock getting that high but the point I'm trying to make is that if this cyclical low behaves like the last 3 cyclical lows, there should still be alot more room left to the upside.

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