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CR None
HNT  

New Long Plays

Crane Co - CR - close: 42.64 change: +0.59 stop: 40.99

Company Description:
Crane Co. is a diversified manufacturer of engineered industrial products. Founded in 1855, Crane provides products and solutions to customers in the aerospace, electronics, hydrocarbon processing, petrochemical, chemical, power generation, automated merchandising, transportation and other markets. The Company has five business segments: Aerospace & Electronics, Fluid Handling, Engineered Materials, Merchandising Systems, and Controls. Crane has approximately 10,500 employees in North America, Europe, Asia and Australia. (source: company press release or website)

Why We Like It:
Our market view leans toward the bearish side right now we still see some bullish candidates. CR looks like a tempting bullish candidate with a relatively consistent up trend and a low-risk entry. CR has pulled back toward technical support at its rising 50-dma and traders are buying the dip. Volume has been above average on the two-day rebound from support. We're going to suggest long positions with CR above $42.00. Our target will be the $45.40-45.75 range, near its recent highs. We'll put our stop loss under support at the 50-dma. Monitor your stops closely. While it looks like CR is bouncing from the support the weekly chart shows a bearish reversal pattern that has not yet been confirmed.

Picked on May 16 at $42.64
Change since picked: + 0.00
Earnings Date 07/24/06 (unconfirmed)
Average Daily Volume: 288 thousand

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Health Net. - HNT - close: 41.12 chg: +1.45 stop: 39.34

Company Description:
Health Net of California, a subsidiary of Health Net, Inc., is one of the largest health plans in California, serving nearly 2.3 million members statewide. It contracts with more than 51,000 physicians, 300 hospitals and 4,600 pharmacies, giving its members greater choice and more convenient access to care. Its commercial, POS and Medicare lines of business have received the "Excellent" accreditation status from the National Committee for Quality Assurance. (source: company press release or website)

Why We Like It:
HNT's recent earnings report in early May was mixed. The company beat estimates but issued a warning for Q2. The lack of weakness on the warning may be because the stock has already been hammered over the last several weeks. Now shares are starting to rebound and the stock has broken out from its bearish channel (see chart). Helping HNT is a rally in healthcare-related issues. Healthcare tends to be seen as a defensive play when the stock market gets volatile or bearish. We also noticed that volume on today's gain was more than double the daily average. We are going to suggest longs with HNT over $40.00. However, more conservative traders may want to see the stock push past last week's highs near $41.30 before initiating new positions. An alternate entry would be a bounce from the $40 level. We are concerned with potential resistance at the descending 50-dma (currently 45.32) so we're going to set our target in the $44.50-45.00 range.

Picked on May 16 at $41.12
Change since picked: + 0.00
Earnings Date 08/07/06 (unconfirmed)
Average Daily Volume: 1.1 million
 

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