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Play Editor's Note: It is really looking ugly out there. Fortunately, we know that stocks don't normally move in a straight line for very long so we should see an oversold bounce soon. Even bear markets have their rallies. The idea here is to try and buy the dip on any follow though from Friday's sell-off. Friday's session was ugly and as the mom-and-pop investor crowd read their newspapers this weekend there could be another spike lower on Monday morning as they hit the "sell" button. We're expecting the Dow Jones Industrials to bounce from the March lows and that could carry the rest of the market higher even if it's temporary. The really sad news this evening is that we didn't find many candidates that looked good enough that we wanted to buy the dip.


New Long Plays

Citigroup - C - close: 19.30 change: -0.87 stop: 17.74

Company Description:
Citigroup Inc. is one of the largest banks and financial services company in the world.

Why We Like It:
Nobody wants to touch the financials and for good reason. Investors keep trying to buy the dip thinking it's the bottom and the sector just keeps sinking. The recent news about the bond insurers getting downgraded is very bad news for the sector and it could spark another huge wave of write downs for the financials. While we do think the financials will see lower lows this year odds are good there will be an oversold bounce when they hit their spring lows. The March low in Citigroup is $18.00. We're suggesting readers buy the dip in the $18.50-18.00 zone. We'll use a stop loss at $17.74. Because we're trying to "pick the bottom", which is usually a hazardous pastime, we're labeling this an aggressive play! If triggered our short-term target is $19.90. Our secondary target is $21.35.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/18/08 (confirmed)
Average Daily Volume: 83 million

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DIAMONDS - DIA - close: 118.24 chg: -2.12 stop: 116.99

Company Description:
The DIAMONDS Trust Series 1 is an exchange traded fund that mimics the performance in the Dow Jones Industrial Average.

Why We Like It:
We suspect that the Dow Jones Industrial Average (DJIA) will bounce near its March lows. It will probably be a temporary bear-market rally but we want to try and capture a chunk of any rebound. We're suggesting readers buy the DIA in the $117.75-117.45 zone with a stop loss at $116.99. If triggered our target is the $121.50-122.00 zone.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume: 13.1 million

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SPDRs - SPY - close: 131.58 chg: -2.17 stop: 129.19

Company Description:
The SPDR Trust Series 1 is an exchange traded fund that mimics the performance of the S&P 500 index.

Why We Like It:
This trade in the SPY is the same strategy as the DIA it's just focused on the S&P 500. We're looking for a dip toward the $130 level early this week at which point the S&P should see an oversold bounce. Our suggested entry point is the $130.50-130.00 zone. We'll use a stop loss at $129.19. More conservative traders may want to use a tighter stop closer to $130.00. If triggered our target is the $134.00-134.50 zone.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume: 200 million
 

New Short Plays

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