MLR - INVN discussion

Published:

7 Mar 2012 18:15 ET

For those of you who may have bought a position in INVN after our recent webinar where we discussed the possibility of picking up some INVN off its 50-day moving average, well done.

In today's trade, INVN was priced out at 14.85 in a secondary offering. It started the day gapping up to 15.46, then pulling back to 15.15. In our view, since it was still a fair bit above its 50-day moving average, and given the tenuous nature of the general market, it could potentially have pulled back closer to its offering price of 14.85, but instead, the general market has drifted higher on what may turn out to be the lowest volume year-to-date, though is true at this time in the trading day.

Odds are a dead cat bounce is in the offing, but whether dead cat or a short-lived pullback depends in large part on Thursday's bond auction in Greece, though the omen is bad given the negative price/volume action of precious metals and other commodities (BHP, CLF, RIO, etc).

Questions that might run through Portfolio Simulator Dude's head:

1) If I buy INVN here, and the market rolls over, I may have to sell my position. I would put the stop in just under issue price of $14.85 since good stocks usually do not break issue price.

2) Maybe I should wait for INVN to pull back closer to issue price so my risk is less.

3) If I don't buy INVN here and it goes higher, I know that I can always get in at a higher price when it has another pocket pivot buy point.

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