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New Short Plays

LifePoint Hosp. - LPNT - cls: 45.35 chg: -1.51 stop: 47.26

Company Description:
LifePoint Hospitals, Inc. is a leading hospital company focused on providing healthcare services in non-urban communities. Of the Company's 52 hospitals, 49 are in communities where LifePoint Hospitals is the sole community hospital provider. LifePoint Hospitals' non-urban operating strategy offers continued operational improvement by focusing on its five core values: delivering high quality patient care, supporting physicians, creating excellent workplaces for its employees, providing community value and ensuring fiscal responsibility. Headquartered in Brentwood, Tennessee, LifePoint Hospitals is affiliated with approximately 19,000 employees. (source: company press release or website)

Why We Like It:
The nine-month up trend for LPNT is in serious jeopardy. The stock has already broken down through support at the $46.00 level and is resting right on its simple 100-dma, which coincides with its rising trendline of support (see chart). We want confirmation that the trend has indeed been broke so we are suggesting a trigger to short LPNT at $44.95. If triggered we will target the $40.50-40.00 range, which appears to line up with a 50% retracement of its nine-month run. The biggest obstacle to reaching our goal is probably the simple or exponential 200-dma that is trading above the $40.00 level. Traders do have an alternative entry available. More aggressive players could look for a bounce back toward the $46.50 region and then short the stock there as it begins to roll over.

Picked on August 04 at $ 45.35
Change since picked: + 0.00
Earnings Date 07/27/05 (confirmed)
Average Daily Volume = 686 thousand


Xilinx - XLNX - close: 27.91 chg: -0.76 stop: 29.01

Company Description:
Xilinx is the worldwide leader in complete programmable logic solutions. (source: company press release or website)

Why We Like It:
The SOX semiconductor index is finally beginning to show some weakness. The sector is so overbought that it could endure several days of profit taking before it finds support. We also like that the SOX's MACD has just produced a new sell signal from very overbought levels. Meanwhile XLNX has also produced a new MACD sell signal as the stock's bounce from the July lows appears to have failed near the $29.00 level. The drop under the $28.00 level today looks like a new entry point to short XLNX although more conservative traders may want to wait for a drop under its simple 100-dma at 27.80 first. If you prefer to short a failed rally then watch for any bounce to roll over under the simple 200-dma 28.75. We are going to target a move into the $26.10-26.00 range.

Picked on August 04 at $27.91
Change since picked: - 0.00
Earnings Date 07/21/05 (confirmed)
Average Daily Volume: 6.1 million

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