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New Plays
Long Plays
Short Plays
BBG None
ETFC  
FLIR  
MASI  
UDRL  

Play Editor's Note: Hopefully you have already digested tonight's wrap. Our market outlook is bearish. However, even bear markets have rallies. The market is very oversold and I am expecting a short-term oversold bounce to show up sooner rather than later (like this Tuesday). Usually the first week maybe week and a half of July tends to be bullish historically as new retirement money gets put to work. Below are short-term bullish suggestions but readers may want to wait for the market to show signs of a bounce before opening up new long positions. Traders should expect any bounce to eventually run out of steam and form a new lower high, which will offer us another entry point for bearish plays.


New Long Plays

Bill Barrett - BBG - close: 59.01 chg: +1.99 stop: see details

Company Description:
Bill Barrett Corporation, headquartered in Denver, Colorado, explores for and develops natural gas and oil in the Rocky Mountain region of the United States. (source: company press release or website)

Why We Like It:
BBG is forming a bullish consolidation pattern under resistance near $60.00. Volume is growing on the rallies and volume was almost three times the norm on Friday's gain. We are listing two different entry points. If BBG breaks out over $60.00 we are suggesting readers buy it at $60.10 with a stop loss at $57.45. If BBG pulls back again we are suggesting readers buy the dip in the $56.50-56.00 zone with a stop loss at $54.95. Our target is $64.85. We're contemplating a secondary target closer to $70. The P&F chart is bullish with a $67 target.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume: 758 thousand

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E*trade Financial - ETFC - close: 3.10 change: -0.16 stop: 2.99

Company Description:
The E*TRADE FINANCIAL family of companies provides financial services including trading, investing and banking for retail and institutional customers. (source: company press release or website)

Why We Like It:
This is pretty simple. ETFC has plunged to support near $3.00 and bounced. While the trend in the financials is bearish it's time for an oversold bounce. The overall pattern in ETFC remains very bearish and the P&F chart points to a $1.75 target. Short-term I suspect that ETF could rally back to its 10-dma. We are suggesting that readers buy ETFC here with a stop loss at $2.99. If ETFC pulls back on Monday toward $3.00 use it as an entry point. Our short-term target is the $3.45 mark. This should be considered an aggressive, higher-risk play since we're effectively calling a short-term bottom and as we all know "calling bottoms" in the market or stocks can be hazardous.
FYI: Just because this is a low-dollar stock do not be tempted to increase the amount of capital you normally commit to a single trade.

Picked on June 29 at $ 3.10
Change since picked: + 0.00
Earnings Date 07/23/08 (unconfirmed)
Average Daily Volume: 17.4 million

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FLIR Sys. - FLIR - close: 41.38 change: +1.67 stop: 37.95

Company Description:
FLIR Systems, Inc. is a world leader in the design, manufacture and marketing of thermal imaging and stabilized camera systems for a wide variety of thermography and imaging applications including condition monitoring, research and development, manufacturing process control, airborne observation and broadcast, search and rescue, drug interdiction, surveillance and reconnaissance, navigation safety, border and maritime patrol, environmental monitoring and ground-based security. (source: company press release or website)

Why We Like It:
This is a simple relative strength play. FLIR has been showing some very impressive relative strength versus the market. The stock broke out to new all-time highs on Friday after a press release Thursday night announced an order from the Columbian Ministry of Defense. Volume has been HUGE on some of the rallies, especially Friday's. FLIR could see a continuation of the short-squeeze. The latest data listed short interest at more than 13% of the 130-million share float. That's about two weeks worth of short interest (granted the bears could have covered several days worth on Friday). We are suggesting long positions here but would prefer to buy a dip near the $40.00 level. Our target is the $44.95 mark (for now). The P&F chart points to a $73 target.

Picked on June 29 at $41.38
Change since picked: + 0.00
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume: 2.2 million

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Masimo Corp. - MASI - close: 34.86 chg: +0.32 stop: 32.95

Company Description:
Masimo develops innovative monitoring technologies that significantly improve patient care-helping solve "unsolvable" problems. In 1995, the company debuted Measure-Through-Motion-and-Low-Perfusion pulse oximetry, known as Masimo SET, which virtually eliminated false alarms and increased pulse oximetry's ability to detect life-threatening events. (source: company press release or website)

Why We Like It:
MASI has been consolidating under resistance near $35.00 for weeks. Share have developed a bullish pattern of higher lows as it coils for a breakout higher. The MACD is nearing a new buy signal. The P&F chart is already positive with a $56 target. If MASI can trade over $36.00 it will produce a new P&F triple-top breakout buy signal. We are suggesting that readers use a trigger to buy MASI at $35.65, which would be above the May peak. More aggressive traders might want to jump the gun early on a move over $35.10. If triggered at $35.65 our target is the $39.95 mark. More aggressive traders could aim for the highs near $42.00 but we do not want to hold over the late July earnings report.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/28/08 (unconfirmed)
Average Daily Volume: 461 thousand

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Union Drilling - UDRL - close: 21.74 chg: +0.80 stop: 20.65

Company Description:
Union Drilling, Inc., headquartered in Fort Worth, Texas, provides contract land drilling services and equipment, primarily to natural gas producers, in the United States. Union Drilling currently owns and markets 71 rigs and specializes in unconventional drilling techniques. (source: company press release or website)

Why We Like It:
Now that crude oil has broken out from its trading range we want to add some exposure to the oil sector. UDRL is an oil services company. The stock is bouncing from a 61.8% Fibonacci retracement of its mid June rally. Plus, it's bouncing near the trendline of support (see chart). We're suggesting a tight stop loss at $20.65. Our target is the $23.90 mark. We do not want to hold over the late July earnings report. FYI: The P&F chart is bullish with a $30 target.

Picked on June 29 at $21.74
Change since picked: + 0.00
Earnings Date 07/30/08 (unconfirmed)
Average Daily Volume: 187 thousand
 

New Short Plays

None today.
 

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