XIDE - stopped out
ACI $22.16 -0.52 -- Arch Coal Inc.
The action in coal stocks has been mixed last week with ACI under performing some of its peers. The short-term trend still looks down. I'm expecting a dip toward what should be significant support near $20.00. I would wait for to test that support near $20 before considering new bullish positions.
Our long-term target is the $30 region.
May 14th, 2009 - entry price on ACI @ 16.00, option @ 2.40
symbol: OSE-AF, 2011 JAN $30 LEAP call - current bid/ask $2.35/2.60
-stop loss on ACI @ 18.95
Chart of ACI:
ANR $37.86 -0.72 - Alpha Natural Resources, Inc.
While ANR may have out performed some of its peers last week the bounce appears to be fading under round-number resistance at $40.00. To make matters worse if shares retreat from here it will look like the right shoulder to a bearish head-and-shoulders pattern.
I am raising our stop loss to $32.40, which is under the October low and under its 100-dma and exponential 200-dma. I'm not suggesting new positions at this time.
Our long-term target is the $50-60 zone.
Aug. 25th, 2009 - entry price on ANR @ 34.00, option @ 7.00
symbol: VJV-AH, 2011 JAN $40 LEAP call - current bid/ask $8.30/9.50
-stop loss on ANR @ 29.50
bought 1/2 LEAP position on 08/25/09 (option price @ 7.00)
Chart of ANR:
BAC $15.05 -0.08 - Bank of America Corp.
I am repeating my warning from last week. BAC has broken several layers of significant support. I would STRONGLY consider a complete exit right here if you have not done so already. It looks like BAC has formed a top over the last three months. The Point & Figure chart has turned bearish and is forecasting a drop toward $10.00. A pull back toward $10 would be close to a 50% retracement of its rally off the March lows.
The only reason I am not closing BAC right now is the current bounce in the S&P 500. If the market can keep inching higher then maybe the banks will recover. If you're not willing to exit right here then consider a stop loss just under $14.00 on BAC (or maybe a stop at $4.00 on the LEAP option).
I'm not suggesting new positions at this time. Our long-term target is the $25-30 zone.
Jan 25th, 2009 - entry price on BAC @ 6.24, option @ 2.38
symbol: VBA-AB, JAN 2011 $10 LEAP call - current bid/ask $6.30/6.35
-stop loss on BAC @ 11.90
10/31/09 Sell Half -- option at $6.00 (+152%)
Chart of BAC
CHK $24.22 -0.60 -- Chesapeake Energy Corp.
CHK still looks a little oversold here given the sell-off from its highs. I'd keep an eye on natural gas prices. Natural gas has been falling but it could bounce from its September lows soon, which could form a bullish double bottom. This means we can probably expect more weakness in CHK on a short-term basis. Look for support near $22.00 and its 200-dma.
Our long-term target is $40.00.
Oct 30th, 2009 - entry price on CHK @ 24.00, option @ 4.70
symbol: VEC-AE, JAN 2011 $25 LEAP call - current bid/ask $4.60/4.80
-stop loss on CHK @ 20.75
Chart of CHK:
CNX $42.81 -3.00 -- Consol Energy Inc.
While CNX did bounce last week I don't think it will last. The bounce was fueled with declining volume and the stock appears to be rolling over. I still expect a decline toward support near $40.00.
I'm not suggesting new positions at this time.
CNX has already hit our first target at $48.50. We will plan to sell the second half or our position at $57.50.
Sep 1st, 2009 - entry price on CNX @ 36.50, option @ 7.80(estimate)
symbol: VTL-AH, 2011 JAN $40 LEAP call - current bid/ask $12.50/13.00
-stop loss on CNX @ 37.40
Target hit 09/16/09 @ 48.50, option price $15.40 (+97%)
Chart of CNX
EMR $41.23 +0.11 -- Emerson Electric Co.
EMR showed some relative strength last week thanks to a better than expected earnings report. The close over $40.00 is bullish.
I am not suggesting new positions at this time. Our target is $47.50.
Sept. 8th, 2009 - entry price on EMR @ 38.00, option @ $4.50
symbol: VHH-AH, 2011 JAN $40 call - current bid/ask $5.30/5.70
-stop loss on EMR @ 33.50.
Chart of EMR:
FSLR $117.93 - 2.83 -- First Solar
FSLR continues to sink with the oversold bounce quickly rolling over. The stock might find some support at its September 2009 lows around $112. Don't be surprised if the stock bounces from $112.
We're not suggesting new positions at this time. At the moment we're long the 2010 January $100 put and we have a covered call play that should be fine if FSLR stays above $90.
Covered Call position:
Long 100 shares of FSLR @ $128.00
Short 2010 $150 LEAPS Call LZL-AA @ $40.70
Profit if called is $40.70 in option premium + $22 in stock (+49%)
if FSLR is above $150.00.
Put Spread position:
Long 2010 $100 LEAPS Put LQM-MT @ $32.90
Short 2010 $250 LEAPS Put LZL-MJ @ $135.70, net credit $103
- Update 08/15/09 -
Cover the 2010 $250 Put at $109.40. Keep the $100 put.
Currently the 2010 Jan. $100 put is worth (bid) $4.70.
If you're curious the 2010 Jan. $150 call is at $ 2.48.
Chart of FSLR
FST $20.30 -0.29 -- Forest Oil Corp.
Last Tuesday's rebound in FST was a bullish reversal pattern but there hasn't been much follow through. I'm concerned that crude oil could be weak short-term and that might drag FST down toward $18.00 again. With our stop at $17.35 I'd still consider buying LEAPS on a bounce near $18.00. Our long-term target is $37.50.
Oct 15th, 2009 - entry price on FST @ 23.85, option @ 7.40
symbol: OJG-AD, 2011 $20 LEAP call - current bid/ask $4.80/5.30
-stop loss on FST @ 17.35
Chart of FST:
GHM $16.70 +0.41 -- Graham Corp.
GHM out performed the market last week with gains five days in a row. The stock is back above the $16.00 level, which was prior resistance. I'd probably wait for another dip and bounce near $15.00 before launching new positions.
Our target is $24.00. Our stop is at $12.40.
Oct 26th, 2009 - entry price on GHM @ 15.15, option @ 2.65
symbol: GHM-FC, 2010 JUNE $15 call - current bid/ask $3.30/3.90
-stop loss on GHM @ 12.40
- or -
Oct. 26th 2009 - entry price on GHM (the stock) @ 15.15
- stop loss on GHM @ 12.40
Chart of GHM:
INTC $18.93 +0.04 -- Intel Corp.
The NASDAQ composite, the SOX semiconductor index, and shares of Intel have all produced new relative lows. This is bearish and could be forecasting a deeper correction to come. Short-term the stock is bouncing but the current intermediate trend is down. I would give some thought to taking some money off the table if we saw another failed rally near $20.00 again. Right now the $18 level and the top of the gap should be support but longer-term I'd expect INTC to fill the gap and trade near $17.00. This is supposed to be a long-term trade and it's going to be tough to sit through the corrections.
I am not suggesting new long-term positions at this time. However, if we see a bounce from the $17.00 level or the 200-dma it might be a new entry point. Our long-term target is the $24-26 zone.
FYI: Shares of Intel don't move very fast. Readers might want to consider turning this play into a calendar or diagonal spread to further maximize your gains.
June 13th, 2009 - entry price on INTC @ 16.31, option @ 1.36
symbol: VNL-AD, 2011 LEAP $20 call - current bid/ask $2.19/2.24
-stop loss on INTC @ 15.90.
Chart of INTC:
MSFT $28.52 +0.05 -- Microsoft Corp.
MSFT managed to rebound back above $28.00 before it filled the gap from its earnings report. I am adjusting our exit target from $30.00 to $29.75. More conservative traders may want to start taking profits early (like right now). We're not suggesting new positions at this time. More aggressive traders may want to aim for $32 or $34.
June 2nd, 2009 - entry price on MSFT @ 21.60, option @ 2.20
symbol: VMF-AE, 2011 Jan. $25 call - current bid/ask $5.35/5.50
-stop loss on MSFT @ 21.95.
10/31/09 - Sell Half @ 27.73, option @ 4.80 (+118%)
Chart of MSFT:
MTW $10.58 -0.17 -- Manitowoc Inc.
MTW delivered a strong bounce from technical support near its 50-dma and exponential 200-dma. Unfortunately volume was pretty light on the rally and that makes me a little cautious here. I'm not suggesting new positions at this time.
Our long-term target is $17.00.
Oct 30th, 2009 - entry price on MTW @ 9.10, option @ 2.61
symbol: VMT-AB, 2011 JAN $10 call - current bid/ask $3.30/3.60
-stop loss on MWT @ 7.49
- or -
Oct. 30th 2009 - entry price on MTW (the stock) @ 9.10
- stop loss on MTW @ 7.49
Chart of MTW:
PBR $49.01 -0.25 -- Petroleo Brasiliero
In spite of all the volatility the oil sector has been able to maintain its bullish up trend. I am concerned that if crude oil breaks down under short-term support near $76 it will spark a sharper sell-off in the oil stocks. Shares of PBR should have relatively strong support near $45.00 and its long-term up trend but I would hesitate to launch new positions there. It will depend on the strength of the broader market.
More conservative traders may want to exit early right now to avoid a loss. FYI: Earnings are expected on November 13th.
I'm suggesting we sell half our position at $54.50. We'll sell the second half at $59.50.
Apr. 4th, 2009 - entry price on PBR @ 35.10, option @ $2.80
symbol: PMJ-AJ, 2010 $50.00 LEAP call - current bid/ask $3.05/3.15
-stop loss on PBR at $43.40
Chart of PBR:
PEP $61.76 +0.53 -- PEPSICO Inc.
PEP continues to look strong. The stock bounced from support near its 50-dma and the bottom of its rising bullish channel (see chart). While the trend is positive I hesitate to launch new positions at this time.
More conservative traders might want to raise their stops toward the $55 region. Our exit target is the $69.90 mark.
July 7th, 2009 - entry price on PEP @ 57.25, option @ $4.50(estimate)
symbol: VP-AL, 2011 $60.00 LEAP call - current bid/ask $6.00/6.40
-stop loss on PEP at $51.50
Chart of PEP:
RAI $48.48 -0.15 -- Reynolds American Inc.
RAI has been churning sideways now for about two weeks. The stock's lack of a sell-off in the last week of October has been matched by its lack of a bounce the first week of November. Normally when a stock consolidates sideways it tends to breakout in the direction of the prevailing trend, which in this case is up but it's not a guarantee.
I'm not suggesting new positions at this time.
Our second and final target is $57.50.
July 24th, 2009 - entry price on RAI @ 42.50, option @ $4.50(estimate)
symbol: OWO-AH, 2011 JAN $40.00 LEAP call - current bid/ask $ 8.70/ 9.20
-stop loss on RAI at $39.75
Sold Half on 10/19 @ 49.50, option @ $8.90 (+97%)
Chart of RAI:
TEX $20.53 -0.56 -- Terex Corp.
TEX has tried to bounce multiple times now from support near $20.00 and its rising 50-dma. This level is still support but TEX's inability to make any progress on these rebound attempts is a cautionary warning. Should TEX breakdown from here look for additional support near $18.00. I'm not suggesting new positions at this time.
Our final target is $29.50.
Sept. 11th, 2009 - entry price on TEX @ 18.25, option @ 4.10
symbol: VXQ-AD, JAN 2011 $20 LEAP call - current bid/ask $5.50/6.10
-stop loss on TEX @ 17.75
Sell half (10/24/09), option at $7.50 (+82.9%)
Chart of TEX:
UYG $5.40 -0.06 - ProShares Ultra Financials (2x) ETF
I am repeating my warning from last week. More conservative traders may want to exit completely right here. The October correction broke significant support and the financials under performed on the bounce last week. The UYG still has technical support near $5.00 and its rising 100-dma but I wouldn't buy it here. Technically the UYG hasn't yet broken its trendline from the March lows so the trajectory is still bullish.
I am not suggesting new positions at this time. Our second and final target is $9.50.
FYI: The UYG trades off the DJUSFN index.
Our strategy called for buying the ETF instead of the options.
Current position in the UYG = $1.50 entry (stop loss: 4.40)
10/14/09 Exit - Sell Half @ 6.31 (gap open exit, +320%)
Chart of UYG:
XIDE $7.25 +0.23 Exide Technologies
Last week's bounce in XIDE was impressive. The stock rallied more than 18%. Unfortunately XIDE dipped to $5.72 on Monday and hit our new stop at $5.75 in the process closing the play.
Sep 2nd, 2009 - entry price on XIDE @ 6.50, option @ 1.25
symbol: FRU-CU, 2010 MAR $7.5 call - exit @ 0.55 on 11/02/09
-stop loss on XIDE @ 5.75
Buy the stock @ 6.50, stopped at $5.75 on 11/02/09 (-11.5%)
Chart of XIDE: