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Play Editor's Note: The market action has definitely turned bearish. More conservative traders may want to consider an early exit for any current bullish positions.


New Long Plays

None today.
 

New Short Plays

Comverse Tech. - CMVT - cls: 20.20 change: -0.04 stop: 20.75

Company Description:
Comverse Technology, Inc. (NASDAQ: CMVT) is the world's leading provider of software and systems enabling network-based multimedia enhanced communications services. Other Comverse Technology business units include: Verint Systems (NASDAQ: VRNT), a leading provider of analytic solutions for communications interception, digital video security and surveillance, and enterprise business intelligence; and Ulticom, Inc. (NASDAQ: ULCM), a global leader and innovator of service enabling signaling software for wireless, wireline and Internet communications. (source: company press release or website)

Why We Like It:
Technology stocks are getting hit the hardest as investors lock in profits on the group's recent run up. One tech stock that was already under performing was CMVT. The stock has a bearish pattern of lower highs under its descending 200-dma. Furthermore the company seems to be hemorrhaging management as it deals with an investigation into its practice of back-dating options for executives. Shares of CMVT look poised to breakdown from its recent consolidation and fall under support at the $20.00 level. We're suggesting a trigger for shorts at $19.85. If triggered our target is the $17.75-17.50 range. Please note that this play might have an extra risk concerning the company's earnings report. The problem is we can't find one and we can't find when it is due to report next. History would suggest CMVT tends to report in March but we can't support that for 2007. Earnings reports are always a risk because there are too many variables and the stock could move sharply either direction on the news. We did find one source that said CMVT's subsidiaries VRNT and ULCM are due to report in March.

Picked on January xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 03/14/07 (unconfirmed)
Average Daily Volume: 4.4 million
 

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