Vapor Group, or Still AvWorks Aviation to Some, Has Cleared the Hurdle (SPLI)

It's a rarity that I reiterate an idea I've previously opined... particularly one that I only published just a couple of days earlier. The fact that I'm going to do so with AvWorks Aviation Corp. (OTCMKTS:SPLI) - perhaps better known to some as Vapor Group - should tell you how important it is to re-convey the message. Here goes...

After a miserable pullback from a peak of $0.45 in late March to a low of $0.046 on Tuesday of this week (a 90% drubbing), SPPLI shares are poised to make a solid bullish swing. I can's stress enough that this optimism in no way reflects any long-term optimism regarding Vapor Group, AvWorks Aviation, or anything else you may want to call it; it's strictly a short-term call. But, given what's at stake, even this budding short-term swing is worth noting.

For those not familiar with it, AvWorks Aviation is officially an electronic cigarette venture. The company's claim to fame is an e-cig vaporizing technology that can essentially turn anything that can be vaporized (without scorching it) into something that can be smoked. It took the marijuana industry about 0.2 nanoseconds to connect the dots, and though SPLI doesn't hold itself up as a marijuana player, the timing of the launch of the new vaporizing product is an amazing coincidence... right at the advent of legalized recreational marijuana, and a big leap forward for the medical marijuana movement.

None of that has anything directly to do with my new bullishness on AvWorks Aviation/ Vapor Group now, however. No, the reason I'm looking for SPLI to swing higher now stems from the pivot clue we saw in Tuesday's bar.

Simply put, Tuesday was a hammer-shaped doji - a bar where the open and close were essentially the same, and both happened to be at the top of a tall daily range. Yes, as the name implies, that long-tail that marks the low for the day means that whole day's bar looks like a hammer. The fact that we saw it on the heels of a huge pullback is another big clue of a bounce. An even bigger clue is that we saw a volume spike for SPLI that day, which suggests a big chunk of any sellers are finally getting washed out and/or a big piece of the would-be buyers army is starting to pour back in. Either way, the volume surge implies a move from a net-bearish to a net-bullish environment.

That was as of Tuesday anyway. The last and much-needed big clue from AvWorks Aviation or Vapor Group shares was the follow-through since then... higher highs and higher lows, which pushed SPLI above the falling resistance line (dashed) as a result. In other words, the momentum has changed direction.

Again, this isn't a long-term call, and it's not fundamentally driven. It remains to be seen what kind of future Vapor Group has, and that picture is made even murkier by the dust of the recent reverse merger with an aviation technology company. For the next few days that I care about, however, none of that really matters.

James E. Brumley is a paid contributor of the SmallCap Network. James E. Brumley's personal holdings should be disclosed above. You can also view SmallCap Network's complete disclaimer and disclosure.