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New Plays
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C None
FREE  
NX  

Play Editor's Note: I wanted to list some of the stocks that made it to our watch list but didn't quite make it to the newsletter as plays. SNDK looks tempting here or over its 100-dma but the NASDAQ looks a little extended so we'd be watching for a dip in SNDK. CGX looks tempting with the breakout over $60.00 but again we'd probably watch for a dip. Volume is pretty low on this stock. PRAA looks like a bullish candidate here but we're going to look for a dip near $41.00. SAPE might be a bullish play on a breakout over $7.75. BBBY rallied through resistance on Friday. SRCL looked like a stock we might want to buy a dip on but earnings are due on April 22nd. MCD also looks like a stock we may want to buy a dip on but earnings are April 22nd.


New Long Plays

Citigroup - C - close: 25.11 change: +1.08 stop: 22.89

Company Description:
Citi is todays pre-eminent financial services company, with some 200 million customer accounts in more than 100 countries. (source: company press release or website)

Why We Like It:
Citigroup reported earnings on Friday that were worse than expected. Traders bought the news anyway hoping that the worst was behind it for the company and for the financial sector in general. Even comments from management that there is still the potential for more write downs in the future did not dampen the rally. Shares soared 4.5% on big volume. Granted the gains were definitely exacerbated by short covering but when investors start buying bad news it seems the tables may have turned for Citigroup. We are suggesting readers buy a dip. Our trigger point to buy the stock is a pull back into the $24.50-24.00 zone. We'll try and limit our risk with a stop loss at $22.89, which is just under Thursday's low. Our eight-week target is the $27.50-28.00 zone.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume: 104 million

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FreeSeas Inc. - FREE - close: 6.92 chg: +0.31 stop: 6.24

Company Description:
FreeSeas Inc. is a Marshall Islands corporation with principal offices in Piraeus, Greece. FreeSeas is engaged in the transportation of dry bulk cargoes through the ownership and operation of dry bulk carriers. (source: company press release or website)

Why We Like It:
The water transport and drybulk carriers have been showing strength in the stock market. Shares of FREE just broke through resistance at the 200-dma and broke out from a two-week sideways consolidation. It would be tempting to buy the stock here but we rather wait for a dip. We're suggesting readers buy the stock on a pull back into the $6.70-6.65 zone. We're listing our stop loss at $6.24 just under the recent lows. Our target is the $7.50-8.00 range. FYI: More conservative traders might try a stop near $6.40-6.50 instead. The inverse head-and-shoulders pattern is forecasting an $8.25 target.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 03/28/08 (confirmed)
Average Daily Volume: 134 thousand

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Quanex - NX - close: 55.01 chg: +0.31 stop: 51.99

Company Description:
Quanex Corporation, based in Houston, Texas, is an industry-leading manufacturer of engineered materials and components for the vehicular products and building products markets. (source: company press release or website)

Why We Like It:
Iron and steel stocks have been big winners in the market but NX has been lagging behind its peers until just this past week. The stock has broken out over resistance near $54.00 and did so on strong volume. We like the breakout but want to buy a dip. We're suggesting readers buy NX on a pull back into the $54.00-53.50 zone. Our target is the $58.00-60.00 range. We do not want to hold over the late May earnings report. The P&F chart is bullish with a triple-top breakout buy signal and a $68 target. NX has above average short interest at 8.9% of the 37 million-share float. This stock could see more short covering to help out the bulls.

Picked on April xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/29/08 (unconfirmed)
Average Daily Volume: 370 thousand
 

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