Remember a small cap company we mentioned a few weeks ago called Wireless Age (WLSA)? Back on November 27th when we took our first look at this wireless device maker, we were impressed by the stock’s move from 11 cents to the then-current price of 19 cents…a 70%+ run. After a little more digging, we found the stock was hot mostly because this small cap company’s CEO was buying a huge amount of stock, and the organization has just completed a big repurchase of 5 million warrants.

Little did we know our small cap stock pick would remain on its tear for a few more days; it peaked at 40 cents on January 9th…more than a double from where we found it, and almost a 300% gain from early November’s trading levels.

For anybody who acted on the idea, is it time to sell? Well, it was time to sell. Since hitting 40 cents, we’ve also watched this stock pull back with all the rest; it’s now at 27 cents (which still isn’t too shabby). However….

If you didn’t cash in the first time, you may be getting a second chance soon. While we’re confident there was a lot of profit taking in early January, the stock was just plain overbought - that’s what happens when you fly from 11 cents to 40 cents. It’s hard to keep rocketing like that without a break.

After reaching a low of 21 cents on Tuesday (the 22nd) though, the ‘overbought’ problem may have been solved. In fact, Tuesday’s long tail suggests a reversal is already in motion. More importantly, WLSA isn’t bearing the burden of a massive gain, which means there’s a shot of another good upside run.

There’s something else though. While we think there’s a short-term ’swing’ trade brewing for WLSA, the weekly chart reminds us there’s much more at stake than a dime or two’s worth of potential. This stock was trading almost at $5.00 in late 2003. Though it was all downhill since then, the last few months have been remarkably different.

We’re not saying it’s a $1.60 stock just yet, but we can tell you the company was doing much less in 2003 than they are now.

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