SLIO Stock Alert – Rare Earth Penny Stock SLIO is My new Pick to Watch!

Posted by Admin on January 25, 2012 under Penny Stock Alerts Blog, penny stocks | 4 Comments to Read

Hello again everyone.

After a very nice victory on my AMEX penny stock, WZE, it’s time to take a look at an extremely interesting company in a very profitable industry.

This stock ran massively into the close, from 16 cents to 24 cents in the last 30 minutes of the day to close up almost 57%, at the high of the day, and on incredible momentum.

That makes this a volatile high-flying play that’s a little risky, but if it goes in our favor…could pay off in an enormous way.

Today this aggressive hot little small cap penny stock certainly showed us it can move fast…

It’s interesting to see how many articles and publications there are regarding the Rare Earth Elements market and its dwindling levels of supply, even going back 4-5 years. A simple Google search will return titles decrying China’s ‘hoarding’ and ‘market lockdown’ on these elements that have become so critically necessary to our current way of life.

For decades, China has been the world’s biggest exporter of Rare Earth Minerals and Metals, with about 98% of all Rare Earth Minerals and Metals that end up in the USA, Europe, Canada, South America, and Russia all coming from China.

Over the last decade, consumption of Rare Earth Minerals and Metals has grown exponentially, due to their use in almost ALL “green” technologies form high-efficiency lightbulbs to hybrid car batteries, and even wind turbine power generators.

In the last 3 years, China has consistently exported less and less Rare Earth Minerals and Metals.  In fact, 2012 will be the first year that China has actually imposed quotas on its Rare Earth producers, legally limiting the amount of Rare Earths they can export!

Because Rare Earth Elements are something that most of us don’t come in direct contact with on any kind of regular basis (not in their raw forms, anyway), many people probably never even realized there was a shortage. But many well-known trade and industry publications paint a situation that borders on sheer panic, with NaturalNews, Popular Mechanics and even National Geographic publishing articles about China’s ‘chokehold’ on the marketplace and the possibility of not just shortage, but unavailability of certain elements in as little as 2-3 years!

The dwindling supply and growing demand of Rare Earth Elements (REE) resulted in a pricing bubble last year that saw REE prices explode, driving up stock values of Rare Earth producers OUTSIDE China.

Everyone wanted a piece of Rare Earth Producers that are NON-Chinese.

Enter today’s alert SLIO – Solo International Inc, one of the few productive operations that currently extracts Rare Earth Elements from multiple locations that are not only outside of China, but are located in areas that are geo-politically friendly to the USA!

About Solo International, Inc.

Solo International is an exploration and development mining company with a focus on deposits of rare earth metals and rare earth elements. The Company is focused on the acquisition, exploration, production, development and, as applicable, the operation of mining properties in strategic bulk mineable industrial metals (such as REE’s, Titanium and Phosphates) sectors of eastern Canada. All of the Company’s properties are currently at the exploration stage in Quebec. For more information visit the Company’s website at www.solointernationalinc.com

Rare Earth Elements and their value and scarcity is very real, and it is an issue that won’t go away if we ignore it. The current outlook is grim, but companies like SLIO can and will change this, and in the process will likely produce huge profits for some very savvy investors who saw this trend early enough to get in cheap.

The United States’ Department of Energy released a warning earlier this month that the clean tech industry is at risk of a serious squeeze, due to the shortage of rare earth metals we are currently experiencing.

“Supply challenges for five rare earth metals (dysprosium, neodymium, terbium, europium {no it’s MY opium}and yttrium) may affect clean energy technology deployment in the years ahead”, says the DOE.

In late December 2011, the Department of Energy published another warning, and stated that supply shortages are likely for the foreseeable future, with 5 elements already reaching “critical” levels of short-term supply. The fact that Rare Earth Elements have no material substitutes and come from a narrow range of producers was cited as further cause for concern.

The bottom line is that Rare Earth Elements are on everyone’s radar right now, and SLIO looks to be in a position to profit from this.

SLIO may only be a small part of the solution, but with shortages like the ones we’re currently facing, most would agree that a geo-politically friendly supplier with active and current production is, at the very least, an incredibly valuable asset.

Bill de Lucy, managing director of Fyfield Metal Assets, authored an InvestmentWeek article earlier this month, explaining his own rationale behind investing in rare earth elements. Just like every single other financial professional alive, he reiterates the critical need for Rare Earth Elements (REE) in many of our nation’s fastest-growing sectors, and emphasizes the obvious growth benefits both short-term and long-term for REE investors.

The reality is that anytime you have something that single handedly threatens the ability of so many important American industries and business sectors, it’s something to sit up and pay attention to! And while the threat of shortage is something that should worry everyone, the truly savvy traders are looking for a way to capitalize on the oldest business concept known to man–supply and demand.

Solo International Inc (SLIO) represents what might be a golden opportunity to profit from this unprecedented shortage.

The fact that China’s own demand for REE is expected to match or exceed its current level of production will squeeze existing supplies and production even more, likely driving prices higher and supplies lower. China has actually started looking to acquire other REE producers outside of its borders, in spite of already leading the world in REE production and exportation!

Take a look at the chart below, which shows the price reaction and movement in response to market scarcity, China’s dwindling exports and other factors we have discussed. As you can see, REE average prices have increased over 1000% since 2002, with most of that growth coming just over the past year or two.

With China further cutting its REE exports for 2012, logic tells us that these prices will be doing even more growing in the very near future.

While increases in pricing of this magnitude are impressive, you will notice that this chart only tracks through the year 2010. What will probably shock you even more is the fact that, according to Motley Fool’s CAPS Blog, data reported by Metal-Pages™ and Asian Metal™ show that REE prices have increased as much as 750% since 2010!

Just last month, Jacob Securities Analyst Luisa Moreno said “There is an economic war over the rare earths, with China on one side and other industrialized nations on the other—Japan, the United States and the E.U. China is probably winning. It has decreased exports in the last few years and increased protection. It has attracted a great deal of the downstream business and it is positioning itself well. At this point, it produces most of the world’s rare earths, and prices are at record highs. Japan and the other countries have been left with few options, and those options are more expensive, such as substitution, recycling and adapting production lines to use less efficient materials.”

In 2009 , the REE junior mining market was a $2 billion industry. Today, REE juniors are a $10 billion+ industry—give or take a little day to day market fluctuation, and the bottom line is that REE are on everyone’s radar right now from day traders to institutional investors.

I believe SLIO is in a position to see a big POP based on this very rare special circumstance.

Judging by today’s late day rally, traders agree with that.

Besides just being in a very exciting niche sector, SLIO is also cranking out some truly exhilarating news!

They made a couple of snoozer fluff announcements about how great their sector is, which didn’t really say anything of value.

But then yesterday a piece of bonafide valuable “real” news was released from SLIO.

http://finance.yahoo.com/news/Solo-International-Inc-iw-571994113.html?x=0

SLIO just acquired a large 60 hectare property in Quebec that seems to have a high probability of producing valuable Rare Earth Elements, and the property has no exploration restrictions!

A lot of the time small-cap news spreads slowly, unless a Titan of Wall Street such as myself spreads the word.  Haha..jk.  Well, not really.  The truth is small-cap news is not going to be on CNBC, so it’s possible traders may not have found out about the news until late this afternoon…which could be partially or fully responsible for today’s monstrous close.

That means plenty of investors still probably don’t know about the news, and I bet plenty will find out tonight both from my alert, and from the attention that comes from SLIO closing as the 2nd largest gainer in the entire OTC market (that traded substantial dollar volume).

The chart is getting hot.

First, today SLIO hit a new 52 week high, and it is in full on BREAKOUT MODE!

A 52 week high doesn’t mean 52 weeks, since it’s only been trading actively this week…but nevertheless, today SLIO hit at a new all-time high!

There was also almost a bullish engulfing today, which is a candlestick pattern where today’s bullish candlestick (white or green usually) body engulfs the entire body of yesterday’s bearish (black or red usually) candlestick.

This is very bullish.

Plus, SLIO is a stock that’s only been trading actively for less than a week.  It’s getting in early on situations like this that has produced some of our biggest winners in the past. Past performance doesn’t indicate future performance of course, but these are some of my favorite trading situations.

As always, I must issue my usual words of warning.  And some extra words on this one, since this is a riskier than usual play. SLIO rallied into the close, and closed near the high which is very bullish, so we should be good to go here.  However, SLIO did pop almost 60% in one day.  Momentum appears strong because of the high close and late day rally.  But after a gain of that size…if momentum fizzles out, SLIO could crash just as hard and fast as it skyrocketed.  So, first make sure you see SLIO’s momentum continuing in a strong way tomorrow! Be sure to use a tight stop, trade with caution, book profits when you can, and never let any one trade go too far against you.  (Biased, unlicensed amateur opinions)

SLIO is in one of the best possible sectors.  SLIO rallied incredibly hard into the close forming a new all-time high, and closed pretty much at the high of the day…both of which create HUGE momentum! SLIO has strong recent news, and the company is just starting to trade actively.  The chart appears incredibly bullish too, which means overall we have a white-hot trading setup on our hands!

Don’t forget, many traders use scanners to scan the small and micro-cap markets for new 52 week highs, and large percentage gainers.  Both of which would lead them right to SLIO.  You can bet all eyes are going to be on SLIO tomorrow with traders eager to see a massively profitable rally.

Keep your eyes on SLIO at tomorrow’s open.

Talk to you then,

PSA – Stock Psycho

www.pennystockalerts.com

Don’t ever invest based on what I say, do your own research and consult with a licensed professional before investing, only invest what you are prepared to lose. Any statements and opinions given are amateur and biased and should be treated as such. Past performance does not indicate future performance in any way. Check the latest SEC filings before investing, and research other information on the risks of investing in penny stocks at www.sec.gov

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