Some readers may recall back in March when I pointed out the odd volume and money flow for LEXG, a stock at the time that was trading for $.10 a share. The stock was quiet for the year with only a few trades, and then suddenly there was big buying at $.10. I was the first to point out the stock, and it posted one of the more memorable runs we’ve seen in quite some time. The stock went on to trade for over $10 a share, yes not a 100% or 1,000% gain, but a 1,000% gain and you heard it here first. Could ALSC be the next LEXG type stock? There are certainly some similarities.
Let’s look at the LEXG chart.
On Friday ALSC, just before noon, had some impressive money flow come into the stock with just 3 trades. Up until now ALSC appears to be a non-reporting shell stock, no revenue, and no investor interest. The company deregistered the stock back in 2008 and has been trading quietly until Friday when someone decided to put almost $1.5 million into the stock through 3 trades. For a stock that had only 5,600 shares trade the day before and zero trades on Wednesday, a 4,000,000 share purchase is sure to draw some attention, especially when you consider this is exactly how the LEXG rally started. One big difference is the money flow on the first day. LEXG had $408,000 in pre-arranged trades while ALSC had $1.4 million or more than 3 times as much money behind ALSC. I think that gives some credence to a big move ahead for ALSC.
Just think about it for a second, those 4,353,042 shares had to be some sort of pre-arranged transaction, just like the LEXG pre-rally purchase. Someone doesn’t put $1.4 million of their own money into a penny stock without good intentions… at least that is my perception of these trades. Could it have been some sort of $1.4 million fat finger? Its possible, but highly unlikely. The bottom line is those shares need to be available to be purchased. For a stock that has never see more than a few hundred thousand shares traded in a single session and has an average daily volume of 60,000 shares having 4.3 million shares go through without a huge jump in price tells you that this had to have some pre-planned transaction.
Stranger things have happened in this market, but one thing is for sure, following the money flow is a great way to find profitable trades. When LEXG was just starting up those millions of dollars in pre-rally shares sure seemed like a big gamble for a stock that had ZERO interest, ZERO revenue and absolutely ZERO positive’s. You could say the same thing about ALSC right now, ZERO assets (as far as we know) , no interest, the only thing this stock has going for it right now is that someone has put $1.4 million of their own money into this stock.
I was telling my subscribers in the chat room on Friday that this stock was a big/risk reward. LEXG was a huge risk all the way from $.10 to $10.68. Everyone, including myself, kept waiting for it to crater, but it didn’t and made many a substantial profit. That’s why people trade this market, trying to find the next big runner. You don’t know what the future holds, but you can take past events and try to apply them to current situations. In this case we have stock with almost no volume suddenly getting over 4 million in three trades and $1.4 million in money volume. After LEXG we know that big money volume into a formerly quiet stock could mean big things are on the way. Could ALSC be the next LEXG?…. and I can say with 100% certainty that we will soon find out.