Option Investor
New Plays
HAVING TROUBLE PRINTING?
Printer friendly version
New Plays
Long Plays
Short Plays
None ENZ

New Long Plays

None today.
 

New Short Plays

Enzo Biochem - ENZ - close: 14.80 chg: -0.20 stop: 15.51

Company Description:
Enzo Biochem is a leading life sciences and biotechnology company focused on harnessing genetic processes to develop research tools, diagnostics and therapeutics and provides reference laboratory services to the medical community. Founded in 1976, we have concentrated on the development of enabling technologies in the areas of gene regulation and gene modification. (source: company press release or website)

Why We Like It:
This is both a play on relative weakness and a bearish technical pattern. ENZ has been sliding under a series of lower highs for weeks now and the recent slide has been powered by above average volume. ENZ is also producing what looks like a bearish head-and-shoulders pattern with a slanting neckline. Today's decline would suggest that ENZ has broken that neckline but we want to see some confirmation. The weekly chart shows a very big pennant shape, which is normally neutral, but we want to confirm that ENZ is breaking down under that longer-term trendline of support (on the bottom part of that pennant pattern. We are suggesting that readers use a trigger at $14.49 to open bearish positions. Such a move should confirm the breakdown in addition to falling below potential support near its late August lows. The two biggest risks are earnings and a short squeeze. We cannot confirm the earnings date but it looks like October 14th. That doesn't give us much time and we do not want to hold over the report. Secondly, the latest data puts short interest at 10.2% of its 24.4 million share float. The potential for a short squeeze is definitely there! If we are triggered we'll start with a stop loss at $15.51. The P&F chart currently points to an $11.50 target. We are going to target the $12.25-12.00 range.

Picked on September xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/14/05 (unconfirmed)
Average Daily Volume: 90 thousand
 

Premier Investor New Play Archives