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New Plays
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New Plays
Long Plays
Short Plays
ABK None
CSX  
ESL  
RIO  
WMS  

Play Editor's Note: We are adding several new plays to the newsletter tonight. In order to save time and space we're going to temporarily eliminate the "Company Description" paragraph. FYI: Some of the stocks we are watching as potential plays are: MW, BMO, RY, and NE.


New Long Plays

Ambac Fincl. - ABK - cls: 27.99 change: +3.39 stop: 24.59

Why We Like It:
Many believe that the financial sector may have produced a short-term bottom over the last day or two. If that's the truth then ABK will have a chance to see an oversold bounce that is long overdue. Shares have been hammered and there has been a crescendo of volume during the recent sell-off and bounce. The trend is still very bearish. By suggesting long positions here we are breaking the rules and trying to call a bottom or "catch the falling knife" scenario. We'll use a stop loss under yesterday's low. Our short-term target is the $34.00-35.00 range. If you want to get technical a 38.2% Fibonacci retracement of the sell-off from October would put a bullish target closer to $40.00. Remember, this is a high-risk, speculative play.

Picked on November 06 at $27.99
Change since picked: + 0.00
Earnings Date 10/24/07 (confirmed)
Average Daily Volume: 5.6 million

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CSX Corp. - CSX - close: 44.87 change: +0.79 stop: 42.75

Why We Like It:
We are going to try again with CSX. The railroad stocks are bouncing back and the group looks poised to rally sharply. CSX has broken its two-week trendline of lower highs. Aggressive traders may want to buy the stock here. We're suggesting a trigger to open positions at $45.25. If triggered our target is the $49.00-50.00 range. The Point & Figure chart points to a $61 target. FYI: Shares of BNI and UNP both look bullish as well. Keep an eye on them.

Picked on November xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 01/22/08 (unconfirmed)
Average Daily Volume: 5.9 thousand

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Esterline Tech - ESL - cls: 54.93 change: +1.00 stop: 53.49

Why We Like It:
The aerospace and defense sector has been hitting new all-time highs. We suspect that shares of ESL are poised to breakout and catch up with its peers. The stock has been consolidating under resistance near $55.00-55.50 for the last few weeks while building a bullish pattern of higher lows along its rising 50-dma. We're suggesting a trigger to buy the stock at $55.51 and we'll place the stop under the 50-dma. Our target is the $59.00-60.00 range.

Picked on November xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 12/06/07 (unconfirmed)
Average Daily Volume: 332 thousand

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Companhia Vale Rio - RIO - cls: 37.75 change: +2.21 stop: 34.95

Why We Like It:
Both the metals and the mining industries were rising today and RIO has a foothold in both sectors. The stock broke out from a bull flag pattern several days ago and shares just bounced from a test of support near $35.00. We normally don't like to chase a big 6% move like today's gain but RIO might get away from us. We're suggesting positions now. More patient traders could wait for a dip back toward $36.00, which should be short-term support. We would expect some resistance near $40.00 but our year-end target is the $42.50-45.00 range. The P&F chart points to a $53 target.

Picked on November 06 at $37.75
Change since picked: + 0.00
Earnings Date 10/25/07 (confirmed)
Average Daily Volume: 24.6 million

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WMS Ind. - WMS - close: 35.80 chg: +1.31 stop: 32.39

Why We Like It:
WMS makes gaming machines for the gambling and casino industries. The stock hit new all-time highs in October and then spent three weeks digesting its gains. The recent earnings report was not very inspiring but shares failed to sell-off on the bad news and the analyst community defended the stock. Volume has surged in the last few days as WMS starts to breakout from its consolidation. Nimble traders might want to try and jump in near $35.00. We are suggesting a trigger at $36.11 to catch a breakout over resistance at $36.00. If triggered our target is the $39.75-40.00 range. The P&F chart is very bullish with a $59 target.

Picked on November xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/25/07 (unconfirmed)
Average Daily Volume: 630 thousand
 

New Short Plays

None today.
 

Premier Investor New Play Archives