Shares of Hoku Scientific Inc (HOKU) are one of Tuesday’s top movers as they jump more than 17%.
With alternative energy-related stocks everywhere on the move, I thought it would be worthwhile to look into this one.
Unfortunately, I didn't find much that really looked appealing from a contrarian perspective. Let's start with the daily chart:
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Chart Courtesy of Thomson Reuters
What struck me here is the tendency for quick spikes that come out of nowhere but reverse just as quickly. I am more in favor of situations where buying shows follow through. Every situation, of course, is different, and this could be the spike that does see follow through, but I would be inclined to sit on the sidelines and wait for proof that steady buying has emerged.
With that caution in mind, I turned to Hoku Scientific's sentiment profile to see if there might be some indicators to support the case that this time is different. A snapshot of that is below.
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For the most part, it looks like the stock is being ignored.
Short sellers have been covering for some time, and both option traders and analysts have shown little interest. On an up-trending stock, I would find this encouraging, but I think that shares of HOKU may have to show more than a one-day pop to spur serious interest.
By Nick Perry of Schaeffer’s Trading Floor Blog
