StockBullz.com

Stockbullz.com Weekly Stock Newsletter #1
March 18, 2006

 “The market does not beat them. They beat themselves, because
though they have brains they cannot sit tight.”
- Jesse Livermore

 Dear Canadian Stock Investor,

This is the first of what I hope will be many and many more weekly Stockbullz.com weekly re-cap letters.

It’s only been slightly over a week since moving over from localstocks.blogspot.com but I think we are adjusting quite nicely.

About 50 of you have already registered on Stockbullz.com which is great, considering there are just over 200 people on the mailing list.

But that means that 75% of you are just silently reading in the background. I don’t mind one bit but it would be nice to have everybody actively participating on the site and making it a truly great and profitable place for every single investor.

Anyways, here are some of my thoughts on the market:

The market overall is quite a bit tougher than it was in late 2005 and early 2006. There is a lot of volatility with many days having stocks trading up, then the next taking back all their gains.

Looking back over the years, this part of the year (March till July) is probably the toughest to make money in. (And October!)

If you look back at my post recommending you to visit Lou Paquette’s Timeless Charts page, there is a nice chart proving this observation.

So shouldn’t I just sell all my stocks in February and buy them back in August you may ask?

Well I’m not going to stop you but I’m keeping my core positions.

Mr. Market sometimes likes to break patterns if they become too obvious, so you never know…

One of the catalysts that could send many resource stocks higher is the current situation in Iran. It’s quite unfortunate, but I see a very high chance that the US will invade Iran within a few months.

With this invasion, I don’t see any way that Oil supplies could not be disrupted.

Therefore, we should see an Oil price spike. How high?

Well Boone Pickens, the billionaire Texas Oil Baron, recently said that he is confident that Oil will reach $75 very soon.

I have been following Mr. Pickens Oil predictions for the past year (both up and down) and he has been quite accurate. Being around the Oil patch all his life, I think he knows more about Oil cycles and prices than anyone out there.

OK, enough of the big picture stuff, I’d rather talk about stocks that will go up and make us money.

My number 1 pick for 2006 is Silvercorp. This Silver Company is working to begin production at their Ying Project in China.

Through my conversations with their Investor Relations, I have found out that Silvercorp’s ambitions are to become one of the largest producers of Silver in the world.

I can see many similarities between Goldcorp just a few years ago and where Silvercorp is today (apart from similar names!).

I am extremely bullish on Silver prices and I really believe we will see $20 Silver within 2 years. The price has easily passed through $10 and the Silver ETF hasn’t even been approved yet.

My number 2 pick is Nova Uranium. I have been touting them since they were only $1.60. Today was a great day for them closing at $3.63. That is a 127% return in only 3 months!

Two other uranium companies that should do well are Paladin Resources and Urasia Uranium.

Connected to Nova is another company I have pushed in the past: Playfair Mining. Today they closed at $0.91. This is a very speculative stock but there is a lot of potential for speculative gains. I bought at about $0.50 and sold half my position at a 120% gain.

This allows me to get a guaranteed 10% gain while leaving half the position to still appreciate. This strategy should not always be used. It should only be used on extremely speculative stocks.

When you are buying more solid stocks like Silvercorp, I would recommend a totally different strategy. I think you should continue to add to your position as the stock continues to go up. I first recommended Silvercorp at $5.82. They are now trading at $12.85. Think about your profits if you bought a small position at your initial buy but kept buying more every dollar it went up…

Some other Silver stocks that could do well are Silver Wheaton and Minco Silver.

Silver Wheaton is as close as you can get to a sure bet. They are extremely well run and they seem to go up every month no matter what. If you think Silvercorp is too risky, this should be your go-to Silver company.

Minco is down slightly since I talked about it. That’s OK because it’s been less than two weeks. Some patience may be required but it could turn out to be a nice buy.

The Kazakh Oil ideas are quite speculative so I’m mainly putting them out there for your own researching pleasure. I think they will do well but who knows…

There are 5 possible plays Arawak Energy, Big Sky, Caspian, Canoro, and Pan Orient.

If you like exotic companies, maybe they’re for you.

This has been a huge first email and I hope it’s been informative for you.

I will do my utmost best to continue to provide detailed and profitable investment research as I have in the past.

Mike

P.S. Please feel free to forward this to all your investor friends. I don’t advertise but I think I provide a lot of content and research you won’t find anywhere else on the web so I need you to do me a favor and spread the word!

 *Note: Most of these picks were recommended on my old blog first.