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New Plays
Long Plays
Short Plays
BWP None
RWT  
TPP  

Play Editor's Note: Market internals for Tuesday's market-wide bounce were pretty good. However, sentiment still seems shaky and we remain very skeptical of the rebound. However, if the market does continue to bounce we want a part of the move so we're listing a few bullish positions. Traders should be very cautious about adding new bullish positions since many believe the worst may not be over for stocks.


New Long Plays

Boardwalk Pipeline - BWP - cls: 36.48 chg: +0.51 stop: 35.35

Company Description:
Boardwalk Pipeline Partners, LP is a Master Limited Partnership (MLP) engaged in the interstate transportation and storage of natural gas. Boardwalk conducts its operations through three subsidiaries: Gulf Crossing Pipeline Company LLC, Gulf South Pipeline Company, LP, and Texas Gas Transmission, LLC. (source: company press release or website)

Why We Like It:
We like BWP as a bullish candidate because shares have shown decent relative strength during the last couple of weeks. While the market was selling off shares of BWP merely consolidated sideways and did not break its bullish trend of higher lows. More aggressive traders may want to open positions now given Tuesday's rally and put your stop under $35.00. We want to see a breakout over resistance near $37.00 so we're suggesting a trigger to go long the stock at $37.10. If triggered our target is the $39.85-40.00 range. Our stop will be $35.35. FYI: Average daily volume is a little low so stay more cautious than normal.

Picked on March 06 at $36.48
Change since picked: + 0.00
Earnings Date 05/14/07 (unconfirmed)
Average Daily Volume: 182 thousand

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Redwood Tr. - RWT - close: 54.80 chg: +4.61 stop: 52.45

Company Description:
Redwood Trust, Inc. (NYSE: RWT) invests in, credit-enhances, and securitizes residential and commercial real estate loans and securities. Through its ownership of residential credit-enhancement securities, Redwood credit-enhances $210 billion high-quality residential real estate loans. Redwood credit-enhances approximately 10% of the jumbo residential loans in the United States. (source: company press release or website)

Why We Like It:
The REITs have been crushed during the market sell-off. Actually for many of the REITs the profit taking began before the market-wide decline began a week ago. Shares of RWT plunged from a recent high of more than $66 to test support near $50.00 with Monday's low. The $50 level looks like significant support and RWT is bouncing. The rebound stalled under short-term resistance near $55.00. We want to see a breakout over $55.00 before initiating new long positions. Our suggested trigger to buy the stock is at $55.25. If triggered our target is the $59.00-60.00 range. More conservative traders may want to avoid this play. In addition to being a REIT, RWT also has exposure to the residential loan market, which has been getting killed as investors flee anything related to residential lending thanks to the carnage taking place in the sub-prime areas. Today that group, the sub-prime lenders, witnessed a sharp bounce but it may just be a bounce and nothing more. FYI: The P&F chart remains bearish given the recent sell-off. The most recent (and probably out of date) data put short interest at almost 7% of RWT's 26.4 million-share float.

Picked on March xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/20/07 (confirmed)
Average Daily Volume: 234 thousand

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TEPPCO Part. - TPP - close: 42.88 chg: +0.22 stop: 41.95

Company Description:
TEPPCO Partners, L.P. is a publicly traded partnership with an enterprise value of approximately $5 billion, which conducts business through various subsidiary operating companies. (source: company press release or website)

Why We Like It:
TPP is another oil-related stock that has been showing some relative strength by resisting any profit taking over the last couple of weeks. Shares have been consolidating sideways inside its larger bullish trend. The recent bounce from support near $42.00 looks like another entry point to buy the stock. Our target is the $44.90-45.00 range.

Picked on March 06 at $42.88
Change since picked: + 0.00
Earnings Date 02/07/07 (confirmed)
Average Daily Volume: 142 thousand
 

New Short Plays

None today.
 

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