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New Plays
Long Plays
Short Plays
None CTAS
  HD

Play Editor's Note: HON, LCC, and OMX all look like potential bearish candidates. We're also watching SBUX for a breakdown under its 2008 low.


New Long Plays

None today.
 

New Short Plays

Cintas Corp. - CTAS - close: 30.00 chg: -1.08 stop: 31.15

Company Description:
Headquartered in Cincinnati, Ohio, Cintas Corporation provides highly specialized services to businesses of all types throughout North America. Cintas designs, manufactures and implements corporate identity uniform programs, and provides entrance mats, restroom supplies, promotional products, first aid and safety products, fire protection services and document management services to approximately 800,000 businesses. (source: company press release or website)

Why We Like It:
Shares of CTAS are floundering in a bearish trend of lower highs and lower lows. The stock just produced a failed rally near $31 and its 10-dma. Now shares are poised to breakdown under psychological support at $30.00. We are suggesting a trigger for shorts at $29.75. Our short-term target is the $27.00-26.00 range. The P&F chart is bearish with a $24 target. FYI: The most recent data puts short interest at 1.7% of the 131 million-share float. That is a short ratio of 1.5 (about 1.5 days worth of average volume to cover).

Picked on February xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 03/20/08 (unconfirmed)
Average Daily Volume: 1.5 million

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Home Depot - HD - close: 27.51 chg: -0.83 stop: 29.16

Company Description:
The Home Depot is the world's largest home improvement specialty retailer, with 2,238 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, 10 Canadian provinces, Mexico and China. (source: company press release or website)

Why We Like It:
HD's big rally in January was a fake. More correctly it was nothing but a correction. The stock reversed at its 38.2% Fibonacci retracement of its prior down leg. The last couple of weeks have seen HD consolidating sideways under short-term resistance at its 10-dma. Meanwhile there have been two homebuilders come out and say that there is no end in sight for the housing slump. Aggressive traders could short HD here. We want to see a little more confirmation of the breakdown under the 50-dma. We're suggesting a trigger to open bearish positions at $27.24. If triggered our target is the $25.10-25.00 zone. You could aim for $24.00. The P&F chart is bearish and points to a $21 target. FYI: We don't have much time. There is less than two full weeks before HD reports earnings. We do not want to hold over the announcement. The most recent data puts short interest at 4.3% of the 1.67 billion-share float. That happens to be about 4 days worth of short interest.

Picked on February xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/26/08 (confirmed)
Average Daily Volume: 20.0 million
 

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