Option Investor
New Plays
Click here to email Jim
Printer friendly version
New Plays
Long Plays
Short Plays

Play Editor's Note: Just a couple of more stocks I'm watching. BCSI looks like a bearish candidate on another move under $20.00 or the recent low. Plus, DELL looks like a bearish candidate for shorts if it breaks $18.80. The P&F chart for DELL points to a $7.00 target.

New Long Plays

None today.

New Short Plays

Amgen - AMGN - close: 41.49 change: -0.00 stop: 42.55

Company Description:
Amgen discovers, develops, manufactures and delivers innovative human therapeutics. A biotechnology pioneer since 1980, Amgen was one of the first companies to realize the new sciences promise by bringing safe and effective medicines from lab, to manufacturing plant, to patient. (source: company press release or website)

Why We Like It:
AMGN has been under performing the market and its peers in the biotech sector. While the BTK has been on a huge run AMGN's meager bounce has already started to roll over. What's going to happen to AMGN when the BTK starts to see profit taking now that it has hit resistance? Before we go any further I want to remind readers that we always consider biotech stocks higher-risk and aggressive plays. These stocks are very sensitive to headline news. You almost never know when the next FDA decision or clinical trials results will come out and they could send the stock gapping higher or lower overnight, which would make our stop losses rather useless. We are suggesting new short positions right now and we'll try and limit our risk with a relatively tight stop at $42.55. There is potential support in the $39-40 zone but our target is the $36.00-35.00 range. We do not want to hold over the late April earnings report.

Picked on April 08 at $41.49
Change since picked: + 0.00
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume: 11.5 million


Freddie Mac - FRE - close: 25.46 chg: -1.14 stop: 29.35

Company Description:
Freddie Mac is a stockholder-owned corporation established by Congress in 1970 to support homeownership and rental housing. Freddie Mac purchases single-family and multifamily residential mortgages and mortgage-related securities, which it finances primarily by issuing mortgage-related securities and debt instruments in the capital markets. (source: company press release or website)

Why We Like It:
Shares of FRE continued to under perform today in spite of being upgraded this morning. The stock is very close to reversing its P&F chart buy signal for a new sell signal. Shares have been struggling with resistance at its 100-dma and the path of least resistance appears to be down again. Currently FRE is near support in the $25.00 region. We are suggesting two different entry points for shorts. Our first entry point is a breakdown under $25.00 with a trigger for shorts at $24.90. Our second entry point for shorts is a bounce (or better yet a failed rally) into the $28.25-29.00 range. For both entries we're listing a stop loss above the 100-dma. Our first target is the $20.50-20.00 zone.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 06/12/08 (unconfirmed)
Average Daily Volume: 20.8 million

Premier Investor New Play Archives