For More Information... For more information regarding Universal Delivery Solutions as an investment opportunity, be sure to review the entire research report in a printable PDF format by clicking the appropriate link below: UDS Group Inc.  Or, to discuss any of these equities, contact:  The Micro Cap Press  15233 Ventura Blvd.  Suite #310  Sherman Oaks, CA 91403  http://www.microcappress.com 1-800-277-9081   China Transinfo Tech: Volume Bigger Than Rally...For Now Though the research staff of the Micro Cap Press generally feels that solid fundamentals are the foundation for a 'good' micro cap stock pick, we're also more than willing to acknowledge how - sometimes - evidence of a stock's strength can first materialize on the stock's chart. One of the key bullish technical signals worth watching for is volume. Specifically, when the amount of volume increases while the stock is rising, it's frequently worth a closer look at the underlying story.  With that in mind, we became curious about micro cap equity China Transinfo Tech (OTCBB: CTFO) over the weekend when we saw the volume behind Friday's rally was nearly twice as strong as the stock's previous record-volume day.  Moreover, we've seen a steady increase in volume over the last month, as the stock has started to move higher following a pretty poor Q3. Since October 1, we've watched CTFO move from $3.20 to $3.84. The technical name for the bullish volume trend is 'accumulation'. Regardless of what it's called though, it's the kind of things shareholders usually like to see, as it hints of an accelerating uptrend. What's most interesting in this instance is how the volume has grown at a greater pace than the stock's trading level....so far. After Friday's volume data is processed though, we suspect there will be a great number of new interested parties. This has the potential to really rev the engines here, so China Transinfo Tech may be worth putting on your watchlist - if you're looking for a speculative idea.  By the way, there were legitimate drivers for the stock's renewed strength. China Transinfo Tech was awarded some major contracts by Oracle and the Chinese Transportation Information Ministry. It's still unclear what kind of impact this will have on the company, but it wouldn't be hard for this company to make a significant improvement of its recent fiscal results.  To see the chart, click here.

From Pink Sheets to Bulletin Board: UDSG

In an ongoing effort to be a complete resource for fans of micro cap stock trading, we wanted to answer a question received over the weekend from one of our readers. Odds are many of you were wondering the same thing. The subscriber writes...

Q. The last wallst.net interview with the UDSG president indicated that they would complete there financial audit, then file for a move from the pink sheets to a bulletin board listing. Can you confirm this? 

A. Yes, we have separately asked the same question, and received the same response - Universal Delivery Solutions Inc. (UDSG.PK) is working towards a bulletin board listing.

It's our understating that the audit team was done as of the end of October. This is a key step in the process, since a company has to report two years worth of independently-verified accounting in order to be considered for a bulletin board listing. Since Pink Sheet companies are not required to provide 24 months worth of quarterly updates to the SEC (though they can), this data first had to first be compiled for UDS Group. Sherb & Co. - a pretty reputable audit firm - did this work. 

The next step in the process is simply to submit the accounting statements and application to the SEC. A 'Form 211' is also complete by any potential market maker for the stock, and includes all the other relevant information about the security. The SEC (not the NASD or NASDAQ) scrutinizes the details pretty intently, and may or may not come back with comments and requests for changes. Once everything checks out, the security has to be 'quoted' by at least one or more market makers for 30 days - simply to ensure there's adequate interest, or enough of a market for the equity to trade fairly to all buyers and sellers.

It is our opinion that UDS Group will indeed qualify for an OTCBB listing. The company expects the listing upgrade to occur later this year or early next year, which we believe to be a reasonable time-frame. And like many moves from a Pink Sheet to bulletin board status, we suspect this one will create greater visibility for the stocks as well as more trading liquidity.

For more about the difference between Pink Sheet trading and OTC Bulletin Board trading, be sure to review our July 6th edition 'Bulletin Board vs. Pink Sheets - It Matters'.
 

Checkin' In: Sector Forecast

Back in our August 10th edition 'A View of the Market, From 30,000 Feet Above', we took a pretty good look at some sectors we thought were ready to lead the market, and pointed out one we expected to lag. Now nearly three months removed from the forecast, we think it's time to check-in.

We were bullish on utilities and technology. We were bearish on the financials. As for energy stocks, we didn't exactly feel bearishly about them, though we didn't expect much more upside either. Of the four sector calls we issued, three have behaved pretty much as we expected. 

On the nearby chart, we've plotted the percentage returns for each of those groups since August 10th. Technology (blue) is up 17.7%, while utilities (red) are up 12.7%. The financials (green) are only up 5.2%. The only one we were off the mark with was energy (black). Energy stocks are up an average of 15.6% since August 10th. So, in baseball terms, we're batting 0.750. 

Of course, picking a winner is fairly easy to do in a rising market. So, performance should be measured on a relative basis...how did these sectors do relative to the overall market? The closest proxy we have for 'the market' is the Russell 3000 (gray). Its percentage return since August 10th? A modest 4.7%. So yes, we firmly believe some strategic sector-picking paid proverbial dividends. 

And which sectors do we see leading the market the next three months? We're still examining our charts and data. Look for the specifics later this week. The only intent we had with today's revisit was to illustrate how well the methodology can work. .
 

Unemployment On the Rise...For Real

In our September 10th edition 'Economic Reality 101 (What's Really Good for the Market?)', we explained how some economic data could be errantly Incorporated into investors' decision-making processes. One of the few tools we felt actually 'worked' was unemployment data. Even then, we never observed an ideal unemployment number. Rather, we only saw historical meaning in the direction of the unemployment trend....falling unemployment was helpful for stocks, while rising unemployment was a burden on the market.

Though we don't mean to sound like alarmists, the unemployment trend is changing shape. See the nearby chart; the hot pink line is the monthly unemployment rate over the last several years. You can see how the market has taken hits when it's rising. October's reading of 4.7% is not leaps and bounds above the multi-year low of 4.4 % (seen in October of 2006), but the slight increases from month to month are starting to become the norm.

As our 'trend' indicator, we've plotted a nine-month moving average of the unemployment rate on top of the unemployment data (black, thin). It too is on the rise now, meaning we're seeing a significant change in direction here. 

This is not a reason to panic, though some gloom-and-doom pundits may try to instill a little fear into the minds of investors. This trend can be reversed, and even if it's not, we don't feel all stocks will suffer as a result. 

On the other hand, we don't condone ignoring the data either. The historical correlation is too consistent to overlook, though a large number of 'sunshine-and-roses' commentators choose to anyway. We wouldn't be doing anybody a favor by blowing smoke. We simply wanted to alert you to the potential of the scenario. Only time will really tell whether or not history will repeat itself.

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Pacific Shores Investments, LLC has been paid a fee of $50,000 cash and 1.5 million shares of newly issued restricted stock by Universal Delivery Group, Inc. for coverage of the Company. Additionally, the Managing Member of Pacific Shores Investments, LLC has purchased 130,000 shares of Universal Delivery Group, Inc. in the open market with an average cost basis of .08 cents per share.

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