New Watch List Entries

AIG - American Intl. Group

HAS - Hasbro

JPM - JPMorgan Chase


Active Watch List Candidates

ATVI - Activision Blizzard

F - Ford Motor Co.

JDSU - JDS Uniphase

LTD - Limited Brands

MCD - McDonald's Corp

URBN - Urban Outfitters


Dropped Watch List Entries

(none)



New Watch List Candidates:


American Intl. Group - AIG - close: 32.89

Company Info

Financial giant AIG has been showing plenty of relative strength. The stock broke out past key resistance near the $29-30 level recently. Now the stock looks a little overbought and due for a pullback. I am suggesting we launch small bullish positions on a dip at $29.00 with a stop loss at $26.75. Our long-term target is $39.00.

FYI: AIG is due to report earnings in early May.

Buy-the-Dip trigger: $29.00, stop $26.75

(Small Positions)

BUY the 2013 Jan $35 call (AIG1319A35)

- or -

BUY the 2014 Jan $35 call (AIG1418A35)

Chart of AIG:

Originally listed on the Watch List: 04/07/12


Hasbro Inc. - HAS - close: 37.00

Company Info

It looks like shares of this toy and game maker are building a bottom. You could argue that HAS formed an inverse head-and-shoulders pattern over the last five months. The stock doesn't move very fast so we'll need to be patient.

I am suggesting we launch bullish positions when HAS closes above $39.25. More aggressive traders might want to jump in early when HAS closes over $38.00 instead. Our long-term target is $44.75.

Breakout trigger: wait for a close over $39.25, stop 36.25

BUY the 2013 Jan $40 call (HAS1319A40)

- or -

buy the 2014 Jan $45 call (HAS1418A45)

Chart of HAS:

Originally listed on the Watch List: 04/07/12


JPMorgan Chase & Co - JPM - close: 44.34

Company Info

JPM is considered the "best in breed" among the major banks. The stock has been a consistent winner since its lows last November. Yet now the stock is starting to correct lower. We want to be ready to take advantage of any correction. Broken resistance near $40.00 should offer support.

I am suggesting we buy calls on a dpi at $40.25 with a stop loss at $37.25. Our long-term target is $49.75.

Investors should note that JPM is due to report earnings on Friday, April 13th, before the opening bell. More conservative traders might want to wait until after the earnings report before launching positions even if JPM happens to hit our buy-the-dip trigger prior to the earnings report.

Buy-the-Dip trigger: $40.25, stop loss 37.25

BUY the 2013 Jan $45 call (JPM1319A45)

- or -

BUY the 2014 Jan $45 call (JPM1418A45)

Chart of JPM:

Originally listed on the Watch List: 04/07/12


Active Watch List Candidates:



Activision Blizzard, Inc. - ATVI - close: 12.69

Comments:
04/07/12 update: ATVI has spent the last couple of weeks churning sideways in the $12.50-13.00 range. We're still waiting for a breakout higher.

I am suggesting we wait for ATVI to close over $13.25. We will buy calls the next day with a stop loss at $12.25. Our long-term target is the $16-18 range.

Breakout trigger: Wait for ATVI to close over $13.25, buy calls the next day with a stop at $12.25

BUY the 2013 Jan $15 call (ATVI1319A15)

- or -

BUY the 2014 Jan $15 call (ATVI1418A15)

Originally listed on the Watch List: 03/24/12


Ford Motor Co. - F - close: $12.47

Comments:
04/07/12 update: U.S. auto sales dipped to a 14.4 million unit pace in March but that's still well above last year's levels. It will be interesting to see if rising gasoline prices have any impact on vehicle sales going forward.

Right now Ford continues to churn inside the $12.00-13.00 zone. I am suggesting we wait for Ford to close over $13.25 and then buy calls the next day with a stop loss at $11.75. Our long-term target is $16.50.

Breakout trigger: Wait for Ford to close over $13.25, buy calls the next day.

BUY the 2013 Jan $12.50 call (F1319A12.5)

- or -

BUY the 2014 Jan $15 call (F1418A15)

Originally listed on the Watch List: 03/03/12


JDS Uniphase - JDSU - close: 13.49

Comments:
04/07/12 update: Ouch! JDSU lost a dollar last week. The correction lower began to accelerate in the last couple of days. The breakdown under the simple 50-dma is short-term bearish. Currently we're still on the sidelines waiting for a breakout past resistance.

I am suggesting we launch small bullish positions if JDSU can close over $15.30. We'll start with a stop loss at $13.90. Our long-term target is $19.75. More aggressive traders could aim higher. FYI: The Point & Figure chart is bullish and is forecasting a long-term $26 target.

Breakout trigger: Wait for JDSU to close over $15.30 (stop 13.90)

BUY the 2013 Jan $17.50 call (JDSU1319A17.5)

- or -

BUY the 2014 Jan $20 call (JDSU1418A20)

Originally listed on the Watch List: 03/31/12


Limited Brands, Inc. - LTD - close: 48.25

Comments:
04/07/12 update: LTD managed to eke out a 25-cent gain this past week. The trend of higher lows remains intact for now. I still don't want to chase it. We want to buy LTD calls on a correction lower. We currently have a buy-the-dip trigger at $44.00.

Our long-term target is $54.50.

Buy-the-Dip trigger: $44.00 (stop loss @ 39.75)

BUY the 2013 Jan $45 call (LTD1319A45)

03/24/12 adjusted buy-the-dip trigger to $44.00 with a stop at $39.75

Originally listed on the Watch List: 03/10/12


McDonald's Corp. - MCD - close: 98.62

Comments:
04/07/12 update: It was a bit of a volatile week for MCD. The stock was removed from the "conviction buy" list at Goldman Sachs, which caused some selling pressure. You could argue that MCD has produced a new lower high this past week. I am sticking to our game plan and waiting for a dip to $93.00 (at this point that's near the rising 200-dma).

If triggered our long-term target is $108.00.

Buy-the-Dip trigger: $93.00, stop 88.50

BUY the 2013 Jan $100 call (MCD1319A100)

03/24/12 adjusted trigger to $93.00
03/17/12 adjusted buy-the-dip trigger to $93.50, stop @ 88.50
12/24/11 adjusted entry point to $95.50, stop loss to $89.50
12/17/11 adjusted entry point to $91.50, stop loss to $87.25
11/26/11 adjusted stop loss to $86.45

Originally listed on the Watch List: 11/05/11


Urban Outfitters Inc. - URBN - close: 30.03

Comments:
04/07/12 update: In a 10-K filing last week URBN offered some positive guidance. Shares also garnered some positive analyst comments. The stock vaulted higher above resistance at $30.00 and spiked to $31.36 on Tuesday. Yet the rally faded and URBN closed at $30.22 on Tuesday. Our plan is to wait for URBN to close above $30.50 and then buy call LEAPS the next day. URBN's ability to close above $30.00 and stay there the last few days is bullish. The stocks' recent strength will definitely be tested on Monday with the market poised to spike lower.

I don't see any changes from my prior comments. If the stock can breakout it could see a short squeeze with the most recent data listing short interest at more than 10% of the float. I am suggesting a trigger to launch small bullish positions when URBN closes over $30.50. We'll use a stop at $27.75. Our long-term target is $35.75.

Breakout trigger: Wait for URBN to close over $30.50 (stop 27.75)

BUY the 2013 Jan $35 call (URBN1319A35)

04/07/12 URBN broke out above resistance at $30.00 this past week but it has yet to close over our trigger at $30.50.

Originally listed on the Watch List: 03/31/12