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home » small cap highlights
Tony Golan
Chief Technical Analyst
StockProfit.com™
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This week I chose to highlight the chart of Cubic Energy, Inc. (OTCBB: QBIK). QBIK is in a strong long-term up-trend. The stock is now making higher highs and higher lows well above a rising 200-day moving average (the red line on the chart above). Relative Strength Differential (RSD), our proprietary indicator for selecting stock in super-strong up-trends, is way above the 25% threshold line, indicating QBIK is far outperforming the S&P and should therefore remain strong and continue trending higher.
QBIK has been in a long-term up-trend all of the past year. More recently, however, QBIK made a low of 161 in late March, then rallied sharply to a new high of 3.49 in a few short days. This powerful rally has helped really separate QBIK from its 200-day moving average, indicating this may be a long-lasting up-trend.
QBIK then corrected mildly against the up-trend and made a higher low of 2.42 before turning back up, and has been consolidating sideways for a few days. If QBIK now goes back below 2.42, it will invalidate the up-trend and indicate it is most likely going back down to the 200-day moving average. As long as it doesn't go below the most recent low, QBIK should follow through on the rally we saw in late March and continue making higher highs and higher lows.
As far as establishing new positions in QBIK, I feel this is not the optimal time to do so and this is certainly not the purpose of me highlighting this stock right now.
Tony Golan
Chief Technical Analyst
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