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New Plays
Long Plays
Short Plays
FRX None

Play Editor's note: We strongly considered shorting some of the homebuilders. Most of them appear to be rolling over. LEN looks like a decent candidate with a breakdown under $18.00. However, we hesitate because we're moving into the spring-summer selling season and LEN has short interest near 30% of the float. Aggressive traders may want to consider it anyway.


New Long Plays

Forest Labs - FRX - close: 41.40 change: +0.94 stop: 39.65

Company Description:
Forest Laboratories is a U.S.-based pharmaceutical company dedicated to identifying, developing, and delivering products that make a positive difference in peoples' lives. (source: company press release or website)

Why We Like It:
FRX has been showing relative strength and out performing its peers in the biotech index (and the drug index) the last several weeks. Shares appear to have built a very solid bottom with several months of trading sideways in the $35-40 zone. Now FRX is breaking out past $40 and today's session saw a breakout over its 200-dma. Aggressive traders might want to consider bullish positions now. We want to see a new relative high so we're suggesting a trigger at $42.15. If triggered at $42.15 our target is the $47.50-50.00 range. We do expect resistance at $45.00. This is not going to be a quick trade but a more intermediate, multi-week trade. We will try and limit our risk with a stop loss at $39.65. However, we always consider trading anything biotech related as higher-risk. One never knows when a headline will come out about some FDA decision, or important clinical trial that could send the stock gapping one direction or the other.

Picked on February xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume: 3.0 million
 

New Short Plays

None today.
 

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