01-10-2014 Trading Journal

Another neutral day for the general market; however, on the SP500, it is definitely biased to the upside due to the consecutive positive closes from Tuesday to today.

Today, except for a small correction on $KNDI, my other seven stocks traded higher at the close.

$GALE continues to trade well and price action is now trading above the 5 MA line which is very bullish from my perspective.

Notice price action is also following the upper band of the Bollinger band.

$KGJI is testing the resistance at $1.85 once again.

It is looking more and more feasible that by next week, price will trade over that resistance.

$CERS has a strong week and price took out the resistance of $7.13 from early October.

From the weekly chart above, I can deduce that price will head much higher from here.  $8 is the next target.

$AMRN is able to close above the December high of $2.19 today.

This is definitely a good sign since it is reflecting a general consensus that FDA “may” come out with some positive response by Jan. 15th.  Of course, this is still a gamble on a binary event; but I sense that the cards may be in our favor the way a card counter know that the dealer may bust giving the number of high cards in the shoe.

$TINY finally came back to life today with price action closed above the 79 & 89 MA lines.

Notice that the Bollinger band had shrunk with price action closed above the upper Bollinger band.  There is a possible breakout to the upside in the next few weeks.

$LRAD is holding its ground above the $1.90 price zone.

See how the 5 MA line is now beginning to point up and may be crossing over the 15 MA line next week.

$XONE continues to hold its ground above the November high at $64.70 support..

I like the fact that price closed above the 5 MA line.

And finally, $KNDI continues to trade inside the consolidation range (grey box).

Since the overall trend is still up, I’m not worried about current price action.

Since seven out of my eight stocks closed higher today; my portfolio continued to head higher.

Current holdings:

KNDI, LRAD, GALE, CERS, KGJI, XONE, AMRN, TINY (fully speculated)

Regarding $PHOT on my other account:

As you can see, price bounced off the 15 MA line near the $0.19 line.  I added some more shares a bit below $0.20.  Since I’m still sitting on unrealized gain on my $PHOT speculation, the additional shares I’ve bought yesterday and today are considered averaging up.  I’m still a believer in $PHOT from a long term perspective.  Why do I worry about a 20 cents correction when I’m looking for dollars plus gain in the years ahead?

My 2 cents.

Today was another neutral day for the general market.

In the same manner, my main portfolio also had a neutral day with three stocks up, three stocks down, and two unchanged.

$AMRN had a huge spike up that last thru out half of the day before it came crashing back down to a slightly positive day.

As we get closer to the Jan 15 FDA decision day, volatility will continue to increase.  Let’s see if price can maintain the upswing tomorrow to end the week in a positive note.

There is really nothing much to report for the eight hi-beta stocks in my portfolio today; however, $PHOT had a wild wild day.

At first, price gapped up and proceeded to head much higher.  After reaching intraday high of $0.467, it corrected a bit and bounced right back up to $0.46 before yoyo-ing b/w $0.38 and $0.44 thru-out half the day.  Then out of the blue, price began a waterfall action that was quite brutal; so brutal that the thought of selling shares entered my mind.

“Get out to lock in profit!”

But then I began to calculate…

“Price is dropping so fast that by the time my order get filled, I may as well get out at the bottom of today range; so why even bother if I still want to buy this stock back later.  I may as well be chasing this stock back up which will then increase my cost basis for no reason other than thinking I can time the market perfectly.”

Instead of acting on automatic pilot like I did with $SSYS trade which took me out of the trade and missed the ensuing bounce, I began to wait for it to settle down before picking up some more shares to take advantage of the correction.

Take a look at the daily chart above, if you take away yesterday big jump, today close represents just another small up day.

Current holdings:

KNDI, LRAD, GALE, CERS, KGJI, XONE, AMRN, TINY (fully speculated)

My 2 cents.

Based on the SP500, market had a neutral day today.

On the other hand, both my portfolio makes new high today; the main and other account with $PHOT.

With the free cash available after the three days settlement was over from cutting my losses on $NUGT, I chose to add more $GALE and some $CERS instead of finding a new stock.  Why?  ’cause both of these stocks were heading higher in the morning.

$GALE gapped up and never looked back.  Seeing that price took out yesterday high and took out the opening range at the same time, I put 3/4 of the available cash into $GALE to go with the momentum.

How would I know $GALE would keep going up after I added?  I didn’t; however, statistically speaking, a strong upward momentum tends to have a high probability of continuing.  It is simple Newton’s law of motion.  See how price bounced off the 5m 79 & 89 MA lines?  Magical, isn’t it?

I also added to $CERS today ’cause it took out $7 buck .  I’d been waiting for this to happen and it did today.

Did you see how price also broke out of the previous high set in early October today?  Now that $7 is breached, it is ready to move on to $8.  I’m in the camp that there is a high probability FDA will approve $CERS’  blood purification system.

$KNDI had a wild run to the upside today and made new high before it came back down to cool off.

Today price action tells me that the market is looking for any excuse to run the price up.  There are a lot of people on the sideline waiting for any definite news to show proof of concept to run this up.  That is how I see it.  Still holding my position long and strong.

$LRAD finally bounced back up strong from the support (blue line).

Due to the fact that $LRAD is my 2nd largest position, today run up add fuel to move my portfolio to higher ground.

Today, six of my eight stocks moved up today, with $GALE leading the gain percentagewise, which allow my portfolio to reach a new level.

Current holdings:

KNDI, LRAD, GALE, CERS, KGJI, XONE, AMRN, TINY (fully speculated).

On my other acccount:

$PHOT had a “belated” monster run.

As I believe in the business model of $PHOT, I can only see that price can only go up and up.  With more States coming on board in coming years, $PHOT can become a force to behold if they manage it right.  With former executive from Microsoft and a stellar group of directors on board, I can only feel excited of the future prospect.  Continue to hold for $1+.

My 2 cents.

The market roared back up today.

The only change I made today was to dump the $NUGT trade after it gapped down at the open.  Although it bounced back to close positive for the day, I’m not sure if the upward momentum is still intact.

$KNDI bounced back up hard in the morning but by midday, sellers again tried to bring it down.  Like a coiled spring, price bounced back somewhat before close.   I’m seeing a lot of resiliency in $KNDI.  All it needs is proof of concept by news of delivering of EV to new car-sharing garages for price to keep on moving higher.

Let’s see if price can continue to bounce higher tomorrow.

$KGJI finally broke out of the downtrend line and it just needs a little nudge to move it out of the $1.85 resistance reflected by the blue line in the daily chart below.

by the look of it, I think it is ready to rally.

$CERS continued to move higher.  We may be able to see a break out over $7 soon.

I like to see price takes out the 11/29 high at $6.86 by tomorrow.

$GALE continued to move higher as well.

I like the slow climb gradually over a quick run-up when I believe in the long-term prospect of the company.  $GALE seems to fit the bill here.

Today, four out of my nine position (shown above) rallied while the rest tumbled slightly; still my portfolio gained nicely due to $KNDI bounce back.

Current holdings:

KNDI, LRAD, KGJI, CERS, XONE, GALE, AMRN, TINY and 4% cash.

My 2 cents.

Oop! Market went down slightly again today.

And $KNDI went down even more.  I was expecting a correction like today and I was sorely tempted to take profit when it was trading back over $13 in the morning.  Again, I’ve to remind myself of the long-term perspective.  I put $LNG in my vision and then $CLDX.  Then I put the price action of $XONE for the last month in my vision as well.  $XONE traded below my initial buy at first and then it came back in spade.  $KNDI will do the same.  It will come back.

After some visualization exercise, my itchy fingers no longer felt like pressing the sell buttons; instead I bought some June call option ($15 strike price) to take advantage of the dip.

$XONE did well today despite its still being down for the day.  Instead of down near 6%, it came back up to settle for a negative 1.58% only while its peer $DDD & $SSYS were down 4% and 6.2% respectively.

Overall, six out of nine stocks were up slightly.  Due to $KNDI being my largest position now, it pulled my portfolio down a bit.  But I’m not worried yet.

On my other account, $PHOT continued to move ahead.  My unrealized gain has doubled but I intend to hold for much longer term.  Like I predicted, the shortage of legal pot is far more extended than expected.  Once Colorado proves to the rest of the country that it can generate mega-tax revenues from legalized cannabis, other States will want a piece of the pie as well.  $PHOT has the potential to become a billion dollar company if it is managed properly.  That is why I like this stock in the beginning when they hired the former Microsoft executive to run the ship.

It has been a long day for me so I’m not putting up any charts today.

Current holdings:

KNDI, LRAD, KGJI, XONE, CERS, GALE, AMRN, TINY, NUGT (fully speculated)

Other account: PHOT plus various option trades.

My 2 cents.

Despite the DOW being up 28%, I considered it a neutral day since the SP500 closed slightly lower.

Today was a small correction day for my portfolio and was also the first change I made to my mixed bag of stocks.

Price action on the 5m chart on the $INO was acting very skittish in a downward fashion.

Immediately, my attention zeroed onto the chart and my trading sense told me to get out quickly when price took out the low of the last three days. I could sense a waterfall price action was about to happen so I sold.  Even though I like this stock for its possible multi-baggers potential, I’m keenly aware, from experience trading $INO, that once the upward momentum of the price action is stalled, price can drop pretty fast.

After I sold, price continued to head lower to the 15 MA line and bounced off from it.  I would look for a possible buy back when price find support at the 79 & 89 MA lines.

With the available cash free-up from sales of $INO, I added to $XONE and $AMRN to round up my position size and moved the rest to $NUGT.  I was expecting price action to take out the resistance of $31.44 and breakout to the upside.

It didn’t happen today; so I’m going to see if it will happen next week.  If not, I will have to cut my losses and wait for $INO to find support before jumping back in.

$XONE was doing fantastic today.

It finally broke out to the upside by taking out resistance from previous high of $64.70 established back in November 2013.  Today break-out is just the beginning of an upward momentum for the rest of the year is what I think it is.

$KGJI continues to bounce up from the 79 & 89 MA lines which tell me next week may be a rally week.

Price is now a short walk to break out of the downtrend line.

$CERS also broke out of the downtrend line.

I can see more rally ahead next week from here.

$LRAD was disappointing today since price took out the lower band of the consolidation to the downside.

Let’s see if price can bounce off the blue support line next week.

$KNDI had a healthy correction that didn’t take away too much gain from early this week.

Just from the look of the chart, I can see more rally next week.

Since both $LRAD and $KNDI are the two largest position in the portfolio, their correction can drag my portfolio down quite a bit.  But thanks to rallies from $CERS, $XONE, and $KGJI, my loss today was not that bad at all.  Even with today minor correction, this week was a great week for my portfolio.

Current holdings:

KNDI, LRAD, KGJI, XONE, CERS, GALE, AMRN, NUGT, TINY (fully speculated).

From my other account:

$PHOT had a strong opening this morning and I was very tempted to lock in profit when price hit the high of $0.25.  But then I’ve to remind myself that this is a long-term play and I’ll need to hold this for at least twelve months to capture the long-term capital gain tax rate.  I like to see more States join Colorado in legalizing recreational pot.  If this can happen, $PHOT will continue to head higher thru out the year in anticipation of more States coming on board.

Today, we have a long-tail (both sides) doji bar.   Let’s see which way price will go next week.

My 2 cents.

After two weeks of up days to close the year, market decided to take a correction on the first day of the new year.

Fortunately for me, six of my stocks were up today with the other three down slightly.

The biggest winner today is again $KNDI. At first, it opened down a bit and then it rallied hard all day until the last hour when profit-taking brought it down a bit.

Notice that price continued to stay above the 79 & 89 MA lines on the 5 min. chart above..

From the weekly chart,below $KNDI looks very strong.

Notice that this week bar completely trade outside the upper band of the Bollinger band.  I’ve reason to believe that $KNDI upgraded to NasdaqGS listing today opens the door for institutions to buy $KNDI.

$GALE also climbed back up above $5 today so that was another good beginning.

If you look at all the MA lines and indicators, they are all pointing up.

The weekly chart also looks strong for $GALE.

With the $ADX beginning to trend up, I see there are still room for the momentum indicators to go up before they are being labeled as overbought.

$KGJI bounced today and that was a good sign.  From the daily chart below, you could see that price action was forming a symmetrical triangle b/w the downtrend line and the 79 & 89 MA lines.

I expect a pop to the upside soon.  Perhaps, it is now $KGJI turn to run hard. If it does, It will surely propels my portfolio to higher ground since $KGJI is my third largest position right now.

Thanks to $KNDI, my portfolio opens to the new year with a bang!  An auspicious sign indeed.

Current holdings:

KNDI, LRAD, KGJI, CERS, INO, GALE, XONE, AMRN, TINY (full speculated).

From my other account:

$PHOT continues to head much higher.

If there are shortage of legal pot in Colorado, I expect to see $PHOT reach a dollar inside three months.  I will not be surprised if the magnitude of the shortage in legal pot exceeds everyone expectation.

My 2 cents.

Let me start off this post with a quote from Calvin Coolidge:

Nothing in this world can take the place of persistence. Talent will not: nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not: the world is full of educated derelicts. Persistence and determination alone are omnipotent.

In hindsight, we know the market has marched on ahead in an upward, albeit in a wavy manner, direction in the year of 2013; nevertheless, my personal path to achieving stock market gain was an uphill battle fraught with potholes and slippery slopes.

Potholes I fell into in 2013:

• $ECTY- large losses (company filing bankruptcy)
• $ETRM- medium losses (failed Phase III study)

Slippery slopes I encountered:

• $AMRN- large losses (you know the story)
• $USU- large losses (I bailed before the reverse split and the ensuing gigantic rally afterward)
• $SZYM- medium losses (whipsawed from over-trading in downtrend market)
• $APRI- medium losses (holding against a downtrend and gave up before the recovering year-end rally)
• $NCTY- medium losses (mistake in betting big on a thinly traded and small float stock)

Despite the multiple losses I endured from the above trades, they were all managed losses.  In other words, I didn’t let these losses get out of control by averaging down.  While some of the losses were large, it was because I made the initial large bet to begin with and not as a result of averaging down   While I had suffered mental frustration with these controlled losses (who wouldn’t?), I did not wallow in self-pity, I got back up and moved on.  I am persistence because I know I can get my money back as long as I’ve my capital intact.  It is a matter of being perseverance in searching for the stocks that will give me back the money and more.

Sidebar: It is extremely important that you manage your losses according to sound money management principle.  If I had not managed my losses, I would not be able to recover no matter how persistence I could be.  The rule of trading world is that you MUST protect your capital to fight another day.  My trading style is focused on finding the hi-beta stocks that will give me the jackpot I’m looking for; thus, I know I’ve to take some hits from time-to-time.   While this has been my endeavor, I’m still developing and evolving as a trader; therefore, trading mistakes were made (as in $SZYM, $APRI, and $NCTY) and I’m learning from them.

Having covered my losses, let’s go over my wins!

• $KNDI- very large gain
• $INO- very large gain
• $LRAD- large gain
• $GALE- medium gain
• $GOGO- medium gain
• $NUGT- medium gain
• $CERS- medium gain
• $CLIR- medium gain

My biggest win in 2013 was $INO. Upon hearing about $INO, I did my research but was initially skeptical since stock price had been trading below below $1.00 for first half of the year. But when price started to climb to near dollar, I began to take notice of a possible breakout.  Then the proliferation of positive preclinical news came into the foreground.  With price advancing over $1, I began to average UP.  Not only that, I kept averaging up on each bounce up after a brief consolidation; by the time price reached $3, I was sitting on such huge gain it would be foolish not to lock in profit especially when I knew the preclinical trials result was still a long way to human trials.  In other words, the price went up too far too fast.  I exited about 80% of my position at an average price of $2.75 and the rest in mid-to-low $2.xx.  It was a very profitable trade.

$KNDI was a trade I found after I got burned by $ECTY.   Despite the punch on the stomach (figure-of-speech), I refused to give up my beliefs in the potential of EV.  $TSLA has pretty much convinced me that EV does have a place in our society after my few failed attempts to short $TSLA with put option.  My shorting $TSLA was based on simple assumption that the market cap had gone too far ahead of the fundamental; however, when I saw the actual Tesla Model S in the showroom and the elegant and simple design of the electric motor compared to the complicated ICE (internal combustion engine); I was sold on the concept of EV.

Tesla high-end car succeeds because Elon Musk knows that the top 10% of the wealth will buy the car if it looks nice and function perfectly.  And when Consumer Reports magazine gave the Tesla Model S the highest score in its Ratings: 99 out of 100 back in July, I knew then that EV is here to stay.

However, the only problem is that if $TSLA, the only EV with a much longer driving range on a single charge than its cheaper competition, already captured the top 10% wealth; who will buy the cheaper EV models with shorter range?  Hence my belief that $ECTY was the key solution to expanding the EV market for cheaper EV models.  Little did I know that $ECTY was so badly managed, despite its being the company chosen by US Department of Energy to spearhead the charging station project, that I promptly lost 80+% of my investment in a single day after $ECTY made an announcement of its major issues.

Still very much believing in the EV potential and that $ECTY mismanagement did not equal to EV failure, I kept on researching for the next EV stock to speculate.

Then I found $KNDI.

What tickle me the most about $KNDI is that it is not selling directly to the consumer which I know will not work because of the range anxiety.  Without the proliferation of charging station everywhere, it will be difficult for an accelerated growth in consumer buying.  But $KNDI is offering a solution that automatically solves the range anxiety issue; not only that it also solves the charging station issue as well.  By embracing the concepts of car-to-go and zipcar except that the EV must be returned to the garages strategically located at multiple fixed locations for recharging purposes, $KNDI found an optimal solution to the range anxiety and battery dilemma in the EV market.  What is more important is that consumers do not need to buy the car but simply rent them for a very low price that is cheaper than hiring a taxi.

At the time when I found $KNDI, price was trading around $5 after it came back down from a quick run to $8.  Because of the secondary offering after the spike to $8, the stock was mercilessly attacked by the short.  On top of that, the uncertainty from having to  wait for the new China EV subsidies that had yet to be announced only added fuel to the short.

Hmmm….

Instead of going away like most everyone because of the history of bad blood from some stock scams from China, I began to see this as an opportunity to buy when it was still cheap.  After reading all the due diligence performed by other $KNDI believers and compared them to those who short, my own analysis prompted me to start building a position in $KNDI.  While I was building my position, $KNDI was trading in a tight range b/w $4.50 and $5.50.  Plenty of patience was required on my part.

The good thing about having a large position on a stock is that you tend to watch its trading pattern very closely on a daily basis.  And when price crossed back over the 79 & 89 MA lines to the upside, I could sense a coming rally.  Thus, I decided to buy a boatload of Dec $7.50 call to supplement my stock position.  As luck would have it, right after I had bought the options, the stock became a runner the very next day.  When price reached $9 and started to reverse direction, I had the good sense to lock in profit on 70% of my option trades.  The rest I gave back to the market when it expired worthless.  Having exited most of my option trades, I decided to reduce my stock position as well to lock in profit.  My swing trade mentality was in full-swing.

From then on, I bought and sold $KNDI to supplement my core position without success for two months.  In fact, my realized gain was slowly leaking thru the multiple whip-saws from my trading in-and-out of the trading position. And then the news of Geely announcing to the public that it would have the EV version of the London black taxi available in five years.  That was all I needed to hear to double-down on $KNDI.  After the Geely announcement, I knew it was time to stop swing trading $KNDI.  Why did I feel that way?  It was the subtle message from Geely that it is committing to the EV market; otherwise, why made such a bold statement?  With $KNDI being in a 50/50 joint venture with Geely for the sole purpose of building EV cars, $KNDI has a LOT to gain from this announcement.

Again, I was correct in my assessment; thanks to my double-down on $KNDI, my gain was quite phenomenon in the last week in 2013.

Sidebar: Performing daily homework in researching for potential runner is the discipline that keeps me going forward.  And I’m not just talking about picking up stock ’cause so and so says he/she is buying.  I need to analyze the fundamental and decide if the stock has the “story” as well as a chart pattern to support it before I venture in.  If you are willing to do YOUR own analysis and homework on a stock regardless where you hear it from, the stock will become YOUR own pick; not someone pick.  And you will trade this stock according to YOUR trading strategy; not someone’s.  The benefit of doing YOUR own analysis is that you will LEARN from your mistake and grow as a trader. Otherwise, you will never grow as a trader if all you do is to follow someone pick.

My purpose of writing about my thought process in my $KNDI and $INO trades is to emphasize the importance of doing your own research.  By doing your own research, you will get a much better sense of the stock and how it is trading.  If you are the more risk-taking type, you may even augment your position size like I’ve done with $INO and $KNDI.

$GOGO came to mind as another perfect example.  After The Fly made the call on $GOGO, I began to research the stock and like what I saw.  Then I started to build up my position based on my analysis of the chart-pattern.  In other words, I began to trade $GOGO irrespective of what The Fly was doing with his $GOGO position.  If you do your own homework, you make the stock your own and you only have yourself to blame if the stock doesn’t perform.  This is the ONLY way you can learn and grow as a trader.

To conclude my post, despite having my portfolio down in the middle of the 2013 due to my losses mentioned above, I was able to climb back out of the hole and ended the year in a very positive note.

Due to my evolving as a trader, I am now focused on shepherding my current portfolio of nine hi-beta stocks for the potential run-up in 2014.  Holding on to a winning position for as long as I can is the only way to make the big bucks.  I like to see all nine of my stocks, if possible, to run the way $LNG and $CLDX ran in 2013 (both of these stocks I used to own but got out way too early!)

Current holdings:

$KNDI – I believe $KNDI will dominate in China with its business model of selling to the car-sharing garages.

$LRAD – I believe its newly minted mass-notification technology will dominate the replacement of the obsolete bullhorn speaker notification system worldwide.

$KGJI- I believe that the new wealth in China will increase consumers’ crave for 24K gold products that $KGJI will have blow-out quarter-to-quarter revenues that price has no choice but to keep going up.

$CERS- I believe that FDA will approve $CERS blood purification system.  Why?  ’cause they are selling them to Europe already without any issues.

$INO- I am “betting” that $INO has finally tweaked its synthetic DNA enough to work in human.

$GALE- I believe its Astral drug will sell well quarter after quarter.  I’m also “betting” that its NeuVax breast cancer treatment will succeed.

$XONE- I believe its 3D manufacturing machines will become dominant in the manufacturing sector.

$AMRN- I believe FDA will meet $AMRN half-way on its Vascepa label expansion.

$TINY- I believe that its portfolio of private investment in multiple nanotechnology companies will take fruition in 2014.

I wish everyone a happy and prosperous New Year!

My 2 cents.

Market decided to take another breather day by staying neutral once again.

Stock Gawd has favored me today once again as well.  As I’ve predicted last Friday, $GALE was either going to take the baton as a runner or it was going to run concurrently with $KNDI.  Well, as luck would have it, the latter was the ones happened today.

Why would $GALE continue to head higher?  I see there are two major catalysts that are favoring $GALE in the coming year- its rapid relief drug Abstral for breakthrough cancer pain and its pipelines of breast cancer treatment drug- NeuVax.

– $GALE management has the good foresight to secure the right to sell Abstral in the US.  And by doing so, $GALE may have hit the jackpot when no one is looking.  Take a look at $INSY. INSY Therapeutics Inc. is the major competitor to $GALE’s Abstral since it is selling their own version of Fentanyl sublingual drug similar to Abstral.  Yet, $INSY carries a market cap of $870 million compares to $GALE $507 million after today close.  While $INSY has other pipelines in the work, its main revenue generator, I believe, is its Fentanyl sublingual drug.

– With proper marketing, I believe $GALE can take market share away from $INSY giving enough time.  Thus, by its Abstral product alone, $GALE has the potential to be worth at least current market cap before counting its breast cancer NeuVax treatment.

– If there are any positive news from its NeuVax trial results, price has no where else to go but up and up.

This is why I’m not surprised to see $GALE bounce higher today.  Friday chart pattern told me it would go higher and it did.

Take a look at the daily chart below:

Price has taken out the 12/5 high at $4.78 with volume higher than the last five days.  Momentum indicators below haven’t shown to be overbought yet; thus, I’m expecting this breakout to go higher this week.

Now look at the monthly chart below:

Whoa! Did you see the breakout from the high of Dec 2010 at $4.08?  From a long-term perspective, $GALE has broken out of a three years high and the chart looks like it is going to go much higher.

Meanwhile, $KNDI did not disappointed.  Instead of handing the baton to $GALE, it ran side-by-side with it.   In the morning, I was struck by a strong urge to sell some $KNDI to lock in profit.  It was my swing trade mentality that kept urging me.  To counter this urge, I’ve to remind myself about the lost opportunity I had with $LNG.  Back in the early days when $LNG was trading around $5 bucks, I loaded up big and gave way to my urge and locked in profit around $7.  After that, due to volatility, I never got back in.  $LNG is now trading at $43!  With $LNG in mind, I was able to sit on my hands.

I’m sure it will be a wild ride here.  I’m expecting to see some profit-evaporation due to volatility and profit-taking.  And I’ll need to remain steadfast in holding my $KNDI position ’cause I know that if I try to swing trade, I’m going to mess up a good long-term trade here ’cause you will never know when the next surprise rally will hit this stock.

From the daily chart above, $KNDI gapped up nicely but ended a red bar.  That may not mean anything but room must be given for some correction and profit-taking.  I’m just satisfied that the last few days have helped my portfolio to regain higher ground.

Asides from $KNDI and $GALE, $AMRN also popped back up today.  I’m a firm believer that there is a possibility for FDA to reconsider $AMRN position and perhaps will meet $AMRN half-way in some fashion.  Furthermore, I’m impressed by the citizen petition that was submitted to the FDA by the grassroots organization called EPAdruginitiative.com.  Read the petition and you will understand why I decided to add more 2014 March $5 call option at 12 cents to increase my bet.  The way I see it, the reward far exceeds the risk many-times over if FDA turns a favorable corner.  If not, I won’t regret my bet since the potential loss is definitely manageable for me.

From the daily chart above, you can see a healthy bounce with price closing above the 5 & 15 MA lines.

I spoke too soon on Friday regarding $XONE.  Today, $XONE flip-flopped with $DDD and $SSYS with the former going down and the latter going up!  Oh well.  Nevertheless, I’m in the money with $XONE and is holding this one thru 2014.

$LRAD, $CERS, and $KGJI were not performing well today but its smaller corrections were totally masked by the gains from $KNDI, $GALE, and $AMRN.  Huge gains from $KNDI has given my portfolio another healthy gain.

Due to $KNDI continued price increase, it has become the largest position in my portfolio with $LRAD coming in second.

Current holdings:

KNDI, LRAD, KGJI, CERS, INO, XONE, GALE, AMRN, TINY (fully speculated).

I also increase my stake in $PHOT in my other account (the same one where I trade options) in preparing for Colorado to open its door to legal pot starting Jan. 1st, 2014.  Per the article here: Colorado To Blaze Marijuana Tourism Trail In 2014 With Legal Pot Shops, it stated:

Whether there will be enough pot to meet the expected rush next year is another matter altogether. State laws impeded efforts to ramp up production before Jan. 1, meaning it could take several months for supply to catch up with demand.

The way I look at it, I’m expecting to see a lot of will-be marijuana growers lining up in front of $PHOT door looking for financing to start their pot farming on Jan. 1st.  Hence my adding more to $PHOT today.

My 2 cents.

Market took a well-deserved breather today by staying neutral.

Meanwhile, I was sitting on a rocket that was going up, up and away…

Yes, $KNDI finally becomes relevant today.  How can it not be?  Take a moment to read the English Translation Transcript for the Q & A Session and Chairman’s Remarks for the 2013 Shareholders Meeting below at the bottom of this post.: (The bold areas are my own emphasis)

Below is the outline of the key points I’ve highlighted in the Q&A:

1. The Company has made excellent Strides this year in expanding interest in the Car Sharing program through announced signed agreements in what appears to be at least five provinces to include Shanghai, totally covering over 250 million population.
2. We expect there will be 2-3 cities launching the car sharing trials in 2014
3. enable us to become the leading pure EV provider in China
4. We expect this Car Share business model will be soon replicated into more cities throughout China

I’m sure there are many more key points in the Q&A but the above four are what I consider the most important to drive the $KNDI sales in 2014.  If anything, $KNDI may be conservative in their estimate; otherwise, why bother to expand manufacturing facilities as mentioned in Section 5 of the Q&A:

• Q:The Company has announced new manufacturing facility building agreements in three other provinces-Hainan, Shandong and now Jiangsu – to add to our current reported total capacity of 130,000 EVs per year.

I do not know if price will continue to head higher from here or there will be profit-taking and a correction after today big-run.  However, any positive confirmations such as future earning reports, completion of car-sharing garages, implementation of car-sharing garages in new cities will definitely push price upward in the same manner as $TSLA meteoric rise we have witnessed this year.

Take a look at the daily chart below:

You can’t dispute the strength of today run-up. It cut thru the Sept 26 high like a hot knife thru butter.

And when you look at the monthly chart below; whoa! What we have is a new high for the last 6 years…

As you can see, even the 5 MA line has a hard time following the strong uptrend.

Not to be overshadowed by $KNDI, $GALE and $XONE both had a strong showing today.

Take a look at the $GALE daily chart below:

Price surely bounced off the 5 & 15 MA line with the 5 now ready to cross over the 15.  And from the two momentum indicators below, you can tell that the bounce is far from over.  Price looks like it may bounce higher soon.

$XONE performed miraculously in the 3D sector simply because it went up while the other two big siblings ($DDD and $SSYS) went down.

Price is near the resistance point of $64.70 established back in Nov 14th.  I like to see price takes out that resistance soon.

The rest of the stocks in the portfolio pretty much cancelled each other with their minor ups and downs; so I won’t bother you with the charts on them.

Today was a good day for me giving that yesterday 20% run-up of $INO was followed by $KNDI 26% jump.  It was as though $INO passed the baton to $KNDI in a relay race to push my portfolio higher before reaching the end of the year.  Now, I’ll really like to see the baton passes on to $LRAD.  That will be quite a sight since $LRAD is my largest position so far.  Nevertheless, if $KNDI continues to run hard and fast next week, $LRAD may be displaced to become the 2nd largest position.

But giving the look on the chart, I see $GALE has the potential to be the next runner after $KNDI or in concurrent with $KNDI.

Current holdings:

LRAD, KNDI, KGJI, CERS, INO, XONE, GALE, AMRN, TINY (full speculated); and yes, I still have my $PHOT on my other account.

My 2 cents.

———————-

Below is the English Translation Transcript for the Q & A Session and Chairman’s Remarks for the 2013 Shareholders Meeting below at the bottom of this post.: (The bold areas are my own emphasis)

The matters discussed at this shareholders meeting may include certain forward-looking statements that represent the Company’s expectations or beliefs. These statements by their nature involve substantial risks and uncertainties, which may be beyond the Company’s control. Actual results could differ materially from those projected in the forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those projected in the forward-looking statements is contained in our Annual Report on Form 10-K and elsewhere in the Company’s filings with the Securities and Exchange Commission. We encourage you to read these materials.

1.
Q: Geely and Kandi’s a 50-50 JV Partnership. How has Geely contributed to the JV in terms of distribution and marketing expertise?

A: The JV partnership with Geely is to develop EV programs in China; therefore, all the related EV programs will be included in JV. The goal for the JV is to implement Public EV sharing system. The resources of Geely and Kandi are available to be fully utilized for JV’s needs.

2.
Q: Geely has said it was turning over its extensive EV R & D to Kandi to lead Geely’s EV expansion; however Kandi has expressed no public interest to date in the “Full Sized EV” market. Is Kandi working with Geely or Volvo in developing “Full Size” EV’s for either Private or Taxi use and if so, is it as a “consultant” or will these cars be part of the JV?

A: The JV’s current panda 7001 pure EV is remodeled based on Geely’s original panda vehicle. There are also other models from Geely that are in the process of being remodeled. Volvo is a part of Geely; at the current stage, we aren’t working on any of Volvo’s vehicle models.

Q: Is there some future expectation of bringing the JV public and if so would it be in Hong Kong or Wall Street?

A: One of the major milestones we set up this year is the Joint venture with Geely Auto. We just completed the ownership transfer of Kandi Changxing to the JV Company. We truly believe this JV represents tremendous opportunities and values to Kandi’s shareholders going forward. At this point, we do not have any plan to list this company anywhere; our only plan is to make the best out of the JV partnership. , In the future, if there are any strategic benefits of listing the JV in Hongkong or mainland China, we will certainly update the market accordingly.

Q: The JV Agreement is very much like a black box – so far I see more Kandi activity than Geely activity. Can you provide a more detailed picture?

A: So far the joint venture agreement has illustrated the detailed collaboration between Kandi and Geely in terms of EV business in China. Our partnership has been working very well so far. All the news and effort you have seen in the press has been collectively from both Kandi and Geely.

3.
Q: To date there seem to be two EV’s included in the JV, the JNJ6290 and JL7002 Panda. The JNJ6290 while manufactured and sold by Kandi, is licensed under an agreement with Zoyte where it is understood that a small (300rmb) fee per car is paid to Zoyte.

A: JNJ6290’s license is now provided by Geely after the joint venture; this model will be renamed to be SMA7000BEV at the end of this month

Q: Will the Manufacturing and Sales of the JNJ6290 remain with Kandi, or will it be fully included in the JV where all future sales will be booked by the JV? If maintained by Kandi, but built in JV owned Changxing, how is the JV paid for the use of the facility?

A: Kandi will sell entire sets of parts of JNJ6290 to the JV, and the finished vehicle will be sold to the customers by the JV.

Q: Is it correct to assume that the co-developed Panda will be split 50-50 through the JV?

A: Yes, you may understand any EV under JV will be split 50/50.

Q: What is the average expected sales price of the JNJ6290?

A: The average expected sales price is about RMB 40,000 without batteries

Q: What is the average expected sales price of the JL7002?

A: The average expected sales price is about RMB60,000 without batteries

Q: What is the expected Service Life of each EV in a car sharing or leasing environment?

A: The subsidies term is 3 years, but we expect the service life will be approximately 5 years

4.
Q: Since September, the PRC Ministries have made two long awaited announcements regarding the subsidy programs. The first outlined the amount parameters and last monththe Ministries named the first 28 approved cities, which included Hangzhou, Jinhua, Shanghai, Jiangsu and Haiku, all cities that Kandi has an announced established presence. Has the actual payment of subsidies begun yet? If not, how soon is it expected?

A: We expect subsidies will begin to pay in the first quarter of 2014

Q:Can you tell us how manufacturers are to be paid the subsidies and are there additional subsidies provided by the Cities?

A:On September 17, 2013, the Ministry of Finance, the Ministry of Science and Technology, the Ministry of Industry and Information Technology and the National Development and Reform Commission (the “Four Ministries”) jointly issued Notice No. 551 of 2013, titling “Regarding the Continuous Promotion and Application of New-Energy Vehicles for the years from 2013 to 2015”. According to the new subsidy policy:

1. The subsidy payments will be distributed to the manufacturers on a quarterly basis in advance and the subsidies will then be paid by the manufacturers directly to the consumers.

2. Each local government is working on its own local level of supporting subsidy policy. We believe the local governments will soon announce their subsidy policies.

Q: Could you break down the amount of subsidies expected on each the JNJ6290 and JL7001?

A: Our understanding is that both car models will receive a subsidy of RMB 45,000 for each vehicle sold from the national government in 2014

Q: If subsidy payments have not yet started, can sales now be made before the actual start and subsidies still paid on these sales?

A:We believe as long as the car is sold during the subsidy period under the policy, it can receive the subsidy.

5.
Q: The Company has announced new manufacturing facility building agreements in three other provinces-Hainan, Shandong and now Jiangsu – to add to our current reported total capacity of 130,000 EVs per year. Are these all to be constructed within the JV?

A: Yes

Q:How are the capital requirements for the Hainan and Shandong manufacturing facilities to be/being met?

A: The JV will be responsible for raising the capital

Q:Will there be car leasing or car share programs in Hainan and Shandong and are they to remain as Kandi only or become JV programs? When do you anticipate to start?

A: All EVs that are manufactured by the JV will be used for the micro public transportation EV sharing program in China and they are getting ready to start.

Q:Are any facilities under construction yet and if so, when is completion expected on each?

A: The facility in Hainan is under construction now and is expected to be completed at the end of 2014 with the local support and assuming the weather and everything go well as planned.

The facility in Jiangsu is in the process of preparation and is also expected to be completed at the end of 2014 with the local support and assuming the weather and everything go well as planned.

As far as Shandong, we are making some strategic planning adjustments.

6.
Q: The Company has made excellent Strides this year in expanding interest in the Car Sharing program through announced signed agreements in what appears to be at least five provinces to include Shanghai, totally covering over 250 million population. What is the status of Shanghai which was announced a few months ago with anticipation of a trial program starting this year?

A: We have just launched the Carsharing program in Hangzhou and so far it has been well-received. At this point, there is no definite schedule for the trial program in Shanghai. Shanghai government is still working on selecting the location and other preparations.

Q:How many cities do you expect will at least have Car Sharing trials underway in 2014?

A: We expect there will be 2-3 cities launching the car sharing trials in 2014

Q: Please give an estimate of EV deliveries in 2013-Q4 from Kandi alone and from the JV?

A: We are expecting that there will be approximately 2,800 EVs to be delivered in Q4

Q:While 30 garages were originally anticipated to be completed in Hangzhou this year, future updates in August by the Company reported two open and 18 under construction. How many are now expected to be completed by December 31?

A:We expect there will be around 10 garages completed before Dec 31, 2013

Q: In terms of EV’s per location, what is the minimum and maximum?

A: Minimum is 30 and maximum is 300

Q: In percentage, what is the anticipated mix ratio between two and four door EVs? (ie. 80%-20%)

A: The current plan is 50/50 for each parking garage

Q: Have there been any problems getting all the needed systems to work as far as billing, etc for the garages?

A: So far everything goes well, as expected

Q:How many locations are expected in Q1 and by the end of 2014?

A: We expect to be over 50, but may be impacted by the weather and spring festival holidays

7.
Q: While the growth potential of Car Sharing easily numbers in the millions of cars over the next few years, little has been said about the long expected Hangzhou 20,000 Long Lease Program recently.

A: The 20,000 EV long term lease program is involved with the State Grid, China Aviation Lithium Battery Co., Ltd. and other related parties. The project has been progressing very slowly. The schedule is out of Kandi’s control and what we can do is to follow the State Grid’s plan. Our focus will turn to the micro public transportation EV sharing project.

Q: Has further development of this program simply been delayed by the delay of the PRC subsidy program, or is it being replaced by long term leasing through the Car Sharing Program?

A: We believe both have impacts

Q: Hong Kong Exchange listed Sinopoly and Kandi jointly announced in April that Sinopoly would be buying 1900 EVs from Kandi by this year end for the lease program. Will this still happen by this year end, or will it be extended into 2014?

A: It is a part of a long term lease project, and it’s slowly progressing. We will follow the State Grid’s plan on this project.

8.
Q: The Company should be congratulated by the recent battery purchase agreement with Premium supplier Wanxiang, particularly the excellent purchase terms. Which programs will they be supplying batteries for?

A: The majority of EVs of the current micro public transportation EV sharing project are using Wanxiang batteries.

Q: As is the case with Sinopoly, is it possible that Wanxiang will participate further than just supplying batteries?

A: We really value the opportunity of working with Wanxiang. We hope to work with them further in the future. However, currently we don’t have any plans.

Q: Will the Company start providing quarterly investor conference calls and some “guidance”, once sales start to normalize?

A: While we have confidence in launching our EV product offering in China, our progress is still in the early stages. The management is not ready to provide financial guidance at this point. However it’s our intention to keep shareholders well informed on the progress. The Company will provide quarterly investor calls when the time is appropriate.

9.
Others

Q: Since Kandi’s EV manufacturing capacity exceeds the demands of the Car Share and Car Leasing Programs, why are you not marketing plug-in EVs to individual buyers nationwide? Possibly via Geely’s showrooms? Can you see huge potential in this market?

A: Our EV manufacturing capacity has begun to rollout in 2013. Going forward in the near future, we believe our current manufacturing capacity is adequate to meet the market demand.

Q&A session ended

***

Final Remarks from Chairman and CEO, Mr. Hu Xiaoming:

Please allow me to make some ending remarks. Let me close by thanking you all for the support and patience you continue to give Kandi. I would also like to take this opportunity to thank all of the directors and management for their efforts and contribution this year. We are a company that tries our best to maximize our shareholders’ value. 2013 has been an excellent year for Kandi from many fronts:

First is the 50/50 joint venture with China’s largest privately owned auto manufacturer Geely Auto and we are grateful that Mr. Li Shufu serves as the Chairman of the JV Company, which we feel very proud about. In this JV, Kandi contributed many valuable assets, including the new full-scale EV production and assembly line in Changxing. Also, Geely’s subsidiary Shanghai Maple Guorun will soon complete the reform and reconstruction and become another EV production base for the JV Company, which will enable us to become the leading pure EV provider in China. Second is the micro public transportation EV sharing project in Hangzhou which was launched this year and has progressed pretty well. In 2014, we expect our EV business may surpass our legacy go-cart business and become a major revenue generator for the Company. We expect this Car Share business model will be soon replicated into more cities throughout China. Third is the national government subsidy policy renewal in September. With the government’s support, we expect EV sales will start to take off soon. We anticipate steady increasing demand for EVs in the coming year.

Finally, on behalf of the board of directors and the management, I would like to once again appreciate the support of all our shareholders. I assure all of you that Kandi’s management will work even harder in the coming year to enhance our product portfolio offering and further improve our communications, internal control, as well as the company transparency. I welcome you to visit our facilities in China and look forward to talking to you soon. With that, I would like to adjourn this 2013 annual shareholder meeting. Thank you very much! Wish all of you a wonderful holiday season.