Rates Do Matter
After a volatile week of conflicting economics and endless sound bites dissecting Fedspeak the markets failed to rebound much from their lows. Interest rates shared the spotlight with crude oil prices and both weighed on the markets. On Wednesday yield on the ten-year rose to a seven-month high at 4.69% while crude retreated from its all time high at $58. Unfortunately both are likely to head higher and fear of that eventuality kept the markets from rebounding into the weekend.
New Long Plays
New Short Plays
Long Play Updates
Phazar Corp - ANTP - close: 25.00 chg: +3.34 stop: 19.99
No change from Thursday's update. A reprint follows:
Picked on March 24 at $23.01
Cox Radio - CXR - close: 16.66 chg: -0.07 stop: 16.39
We have very little to report on for CXR. The stock continues to consolidate sideways between support at $16.50 and the $17.10 levels. Technical oscillators are mixed so they don't help much. We would keep an eye on the major indices (the Dow and S&P 500). If the major averages continue lower then we would expect CXR to break support at the $16.50 level and probably retest the $16.00 mark and its 200-dma. More aggressive traders can still consider bounces from $16.50 as entry points. We would prefer to wait for CXR to trade above the $17.10 mark before going long.
Picked on March 01 at $16.53
Fresh Del Monte - FDP - close: 30.56 chg: -0.49 stop: 29.89
No change from Thursday's update. A reprint follows: FDP is showing some volatility here if you look over the last three sessions but the short-term trend is bullish given Tuesday's technical breakout. Today's pull back was on low volume and FDP was already starting to bounce late in the session. We would watch for a move back over $31.00 as a new bullish entry point.
Picked on March 22 at $30.82
Syneron Medical - ELOS - close: 33.70 chg: +0.68 stop: 29.49
ELOS has shown some volatility following its bullish breakout a few days ago but traders have bought the dip and shares look poised to move higher. We would use the bounce as a new entry point. Our target remains unchanged in the $37.00-38.00 range.
Picked on March 21 at $33.65
Innovative Solutions... - ISSC - cls: 33.75 chg: +0.62 stop: 29.25
ISSC is a recent addition to the play list. We were going against the grain with the NASDAQ and the GSO software index trending lower but ISSC's technical breakout from its wedge pattern on strong volume looked like a bullish entry point. Since then the stock has continued to rally and shares are nearing our short-term target at the $35.00 level. Should the stock pull back a bit we would look for ISSC to find support in the $31-32 range. Readers can use a dip as a new entry point.
Picked on March 22 at $31.50
Technical Olympic - TOA - cls: 31.20 chg: +0.75 stop: 28.95
No change from Thursday's update. A reprint follows: We like the bounce but there was no volume. However, TOA, unlike many other homebuilders, was able to maintain its gains after the positive new home sales news out this morning. Several other builders began to fade into the afternoon. The MACD has produced a new buy signal but we suggest traders prepare themselves for the possibility that TOA may still need to retest the $30.00 level as support.
Picked on March 22 at $30.45
Valassis Comm. - VCI - close: 35.63 chg: -0.49 stop: 34.75
VCI's initial rally after breaking out over long-term resistance failed near the $38 level and now shares are testing old resistance as new support near $35.00. VCI did not produce much follow through on its recent bullish engulfing candlestick reversal pattern four days ago and Thursday's decline looks troublesome. We would watch for another bounce from the 50-dma and/or $35.00 level or we would wait for a new move over the $36.50 mark as a new bullish entry point.
Picked on February 23 at $36.12
Short Play Updates
Anheuser Busch - BUD - close: 47.28 chg: -0.11 stop: 49.01 *new*
BUD continues to under perform and trend lower under a pattern of lower highs. However, we're starting to worry that BUD is not dropping fast enough to reach our $43.00-44.00 target range before its late April earnings report. Plan accordingly. We are going to lower our stop loss to $49.01.
Picked on February 7 at $48.32
Countrywide Financial - CFC - close: 31.86 chg: -0.33 stop: 35.01
No change from Thursday's update. The minor failed rally at the 10-dma today could be a new bearish entry point. Keep in mind that the stock is not that far away from our 30.50-30.35 target range.
Picked on March 09 at $33.36
Flextronics - FLEX - close: 12.16 chg: +0.06 stop: 13.01
We do not have much new to report on for FLEX. The short-term and long-term tends remains bearish but the last few days have seen FLEX churn sideways. The lack of movement is due to the SOX semiconductor index, which has also been churning sideways. The SOX has been stuck in a range between minor resistance at 420 and minor support at 410. If the SOX breaks out over 420 we'd look for FLEX to breakout over $12.50. If the SOX breaks down under 410 then we'd expect FLEX to breakdown under the $12.00 level. More conservative traders may want to consider tightening their stops toward the $12.50 level for FLEX.
Picked on March 16 at $11.95
Nabi Biopharma - NABI - close: 12.41 chg: +0.01 stop: 13.11
NABI has managed to crawl back toward resistance at its 40 and 50-dma's, which happens to coincide with the four-month trendline of overhead resistance. Meanwhile the BTK biotech index has also bounced back toward the top of its descending channel. Both should roll over from here and continue lower. Should NABI surprise us with another gain the stock has additional resistance at its 200-dma near the $13.00 level. Watch for a drop back under the $12.00 mark as a new bearish entry point.
NY Times - NYT - close: 35.56 chg: -0.20 stop: 37.35
NYT continues to hit new three-year lows and the breakdown under the $36.00 level looks like the last line of support between here and our target range of 32.50-33.50. The MACD is about to produce yet another sell signal. Watch the $36.00-36.40 region, bolstered by the 21-dma, to act as new overhead resistance on any bounce.
Picked on February 20 at $37.20
ScanSource - SCSC - close: 55.96 chg: -0.99 stop: 60.51
The initial bounce from the $55.70 level has failed and now SCSC is testing support again. Short-term technical oscillators are negative and its P&F chart's sell signal points to a $47 target. At this point in the game traders might want to wait for a drop under $55.00 before considering new bearish positions. Meanwhile more conservative traders might want to consider a tighter stop loss. We continue to target a decline to the $51 region but plan to exit before SCSC's late April earnings report.
Picked on March 13 at $ 57.58
Symyx Tech. - SMMX - close: 22.51 chg: -0.13 stop: 26.01
SMMX has performed exactly as expected with shares decline on above average volume. Currently the stock is testing potential support at the $22.00 level. Right now SMMX looks a little oversold and due for a bounce even though its bearish P&F chart points to an $18 target. If the major averages bounce at all next week we would expect SMMX to rally back toward overhead resistance at the $24.00 level. Traders can use a failed rally under $24 as a new bearish entry point. Our target at $20.00 remains unchanged.
Picked on March 21 at $23.79
United Industrial Crp. - UIC - cls: 29.44 chg: +0.44 stop: 31.51
No change from Thursday's update. A reprint follows: It looks like UIC produced an oversold bounce today but the rebound failed under the $30.50 level. This could be a new bearish entry point but we would wait to see UIC confirm the drop with a move under the $29.00 mark.
Picked on March 17 at $29.23
West Marine - WMAR - close: 20.75 chg: +0.45 stop: 23.11
WMAR is trying to bounce from round-number support at the $20.00 level. The stock does look short-term oversold so it would not surprise us to see WMAR bounce back toward resistance at the $22.00 level before continuing lower. We're also watching the simple 10-dma near $21.50 as a spot to look for a failed rally. Readers can use a failed rally at either point as a new entry point. Our target at $19.00 remains unchanged.
Picked on March 17 at $21.20
Closed Long Plays
Closed Short Plays
Today's Newsletter Notes: Market Wrap by Jim Brown and all other plays and content by the Option Investor staff.
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