SulphCo Inc (SUF)

Company

"SulphCo, Inc., headquartered in Sparks, Nevada, was founded by Dr. Rudolf Gunnerman to develop and commercialize its revolutionary technology, which uses high-powered ultrasound to significantly reduce sulfur content in crude oil while simultaneously increasing the amount of usable oil that can be refined from any given barrel of crude." (company website)

SUF 3-month stock chart

Buy

21-Apr-06. Sulphco broke out of a long sidewise move last December, rose sharply, and fell back, coming to rest in March just above the breakout point (see sidebar). There are early signs that SUF is recovering. Although I don't usually pay much attention to "fundamentals" in this case, SUF should benefit from the tightening oil supplies and the resulting need to maximize production from whatever crude is available.

  • Price momentum (PPO) — steadily increasing
  • Trend (ADX) — stable just at/above the threshhold (20), but buying pressure (+DI) is picking up
  • Money flow (CMF) — neutral
  • Relative strength (RSI) — getting stronger
  • Volume — fairly stable, although average volume is less than it was three months ago

This may be characterized as an "early buy" into what one hopes is an developing uptrend.

Sell

loss Bottom line
1%

4-May-06. I still think I bought SUF for all the right reasons, but weakness in the chart was making me nervous, and in view of big losses I had to eat lately (HLIT, HLIT, APTM), I don't want to risk suffering another loss. A loss seldom helps grow the portfolio.

  • Price momentum (PPO) has leveled off
  • Trend (ADX) is weakening
  • Money (CMF) has been flowing out of the stock
  • Relative strength (RSI) is weakening
  • Volumes continue to decline

In other circumstances I would be inclined to ride this one out — I did jump in as an "early buy." Unfortunately, there is nothing comforting about the oil industry these days, unless you're sitting on big piles of ExxonMobile, Conoco, Chevron, etc.

SUF 1-year chart
SUF 1-year chart