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Bullish Play Updates

Arch Coal - ACI - close: 36.50 change: -0.66 stop: 33.00

ACI soared more than seven percent Thursday on some positive earnings news from a rival coal-miner. Now that the tone has been set investors are looking for ACI to turn in a similar earnings performance. Friday's 1.7 percent pull back is normal profit taking after Thursday's big gain and we're encouraged to see that broken resistance at $36.00 acted as new support on Friday. We have six trading days before ACI's earnings report on February 8th. Wall Street is expecting 29 cents a share. We plan to exit before the report either next Friday or the Monday before earnings. Nimble traders willing to go long with such a short time frame can use a bounce from the $36 level as a new bullish entry point. Our target is the $39-40 range.


 

Picked on December 13 at $34.71
Gain since picked: + 1.79
Earnings Date 02/08/05 (unconfirmed)
Average Daily Volume: 951 thousand

BP Prudhoe Bay - BPT - close: 52.54 chg: -1.06 stop: 47.99

Shares of BPT have been very strong almost all week after breaking out over resistance at the $50.50 level. The breakout solidified the ascending triple-top breakout buy signal in its P&F chart, which currently points to a long-term $82 target. We are only targeting a move to the $55.00 region. Short-term the stock looks a little overbought and Friday saw some profit taking. We would look for a dip back toward the $50.50-51.00 region or the 10-dm (51.15) as a new bullish entry point, although we'd wait for signs of a bounce first.


 

Picked on January 24 at $50.51
Gain since picked: + 2.03
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume: 240 thousand

Cyberonics - CYBX - close: 25.44 chg: -0.15 stop: 22.99

CYBX is a new play we added on January 26th given the breakout over round-number resistance at the $25.00 mark. There hasn't been any new news on the VNS Therapy challenge with the FDA in the last couple of days. Yet were are encouraged by what appears to be traders buying the dip to the $25.00 level on Friday. Look for a confirmation next week before initiating new bullish positions. Remember this is a short-term play and we have just ten trading days left before we need to close this play ahead of CYBX's earnings report.


 

Picked on January 26 at $25.91
Change since picked: - 0.47
Earnings Date 02/11/05 (unconfirmed)
Average Daily Volume: 600 thousand

El Paso Corp - EP - close: 10.84 change: +0.01 stop: 10.29

Natural gas play EP continues to display a bullish trend but shares have been consolidating between $10.60 and $11.00 the last few days. Short-term technicals are on the verge of turning bullish again and its P&F chart remains positive. We would still consider new positions at current levels or wait for another move past the $11.00 mark. We are going to keep our stop at $10.29 just under the rising 50-dma.


 

Picked on January 13 at $10.61
Gain since picked: + 0.23
Earnings Date 03/20/05 (unconfirmed)
Average Daily Volume: 3.9 million

Encore Acquisition - EAC - close: 36.11 change: -0.79 stop: 33.49

After highlighting EAC on the watch list earlier this week we decided to add the stock to the play list on Wednesday to capture any future strength in oil and the oil service sectors. We used a trigger at $36.10 to open the play which was triggered on Thursday's breakout over major resistance. The move produced a new triple-top breakout buy signal on its P&F chart. The stock does look a little short-term overbought and EAC felt some profit taking on Friday. Fortunately, traders bought the dip to $35.40 and the stock was bounce off its lows before the close. We notice that the weekly chart shows a new MACD buy signal. The dip on Friday looks like another entry point but remember we plan to exit before EAC's February 15th earnings report.


 

Picked on January 27 at $36.10
Change since picked: + 0.01
Earnings Date 02/15/05 (unconfirmed)
Average Daily Volume: 173 thousand

Frontier Oil - FTO - close: 27.70 change: +0.11 stop: 25.99

FTO is another new bullish play in the oil sector and shares broke out major resistance at $27.00 on Thursday. Our entry point was a trigger at $27.05. FTO experienced some profit taking on Friday morning but traders bought the dip here too as the stock bounced from broken resistance now new support at the $27.00 level. Our target remains the $30.00 region.


 

Picked on January 27 at $27.05
Change since picked: + 0.65
Earnings Date 02/17/05 (unconfirmed)
Average Daily Volume: 212 thousand

Bearish Play Updates

Intel Corp - INTC - close: 22.24 change: -0.07 stop: 23.01

It has been a boring week for INTC traders. Monday started off in the right direction with a breakdown under the $22.50-22.25 support region. Our entry point was to short INTC at $22.24. The stock actually traded to 22.89 on Monday and looked poised for more weakness. Unfortunately, shares rebounded on Tuesday and proceeded to trade in a range between $22.60 and 22.00 the rest of the week. The overall trend remains bearish and its P&F chart continues to point to a $17.00 target. We would consider new short positions on a drop below the $22.00 level. We'll exit if INTC can trade into the $20.50-20.00 range.

Picked on January 24 at $22.24
Gain since picked: - 0.00
Earnings Date 01/11/05 (confirmed)
Average Daily Volume: 240 thousand

Kohl's - KSS - close: 45.62 change: -0.07 stop: 47.01

KSS is a new bearish play we added to the list a few days ago. The original play description mentioned how Wall Street was very optimistic that KSS would out perform during Q4 last year and the first couple of quarters this year because year-over-year comparisons would be so easy (because the previous year went so poorly for KSS). Those expectations were short down when KSS issued a warning in early January. Now the stock is sinking under a pattern of lower highs but is also nearing support with a rising trendline dating back to April 2004. We have a trigger at $44.49 to capture a breakdown below this trendline and the $45.00 level. Our target is the $41-40 region, which is a little less bearish than the P&F chart that points to a $38 target.


 

Picked on January xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/25/05 (unconfirmed)
Average Daily Volume: 1.7 million

Nuveen Investments - JNC - cls: 37.22 chg: -0.06 stop: 39.01

Our high-risk, speculative, call-the-top play in JNC is growing more risky. The XBD broker-dealer index is trying to mount a rebound. Meanwhile shares of JNC churn sideways between 37.75 and 37.00 all the while holding support at the simple 50-dma. If we don't see some downward momentum soon traders may find it prudent to exit early. Conservative traders (who probably shouldn't be playing this to begin with) may want to tighten their stops toward the $38 level. Our target remains the $34 level near the 38.2 percent Fibonacci retracement of its August to December rally although we may end up adjusting the target to its 100-dma. We would not consider new bearish positions until JNC traded back under the $37 level.

Picked on January 24 at $36.90
Gain since picked: + 0.32
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume: 65 thousand

Synopsys - SNPS - close: 17.12 change: -0.07 stop: 17.55*new*

The week has also proved somewhat boring for SNPS traders. Shares of churned sideways between $16.70 and $17.40 all week. We do note a high-volume sell-off late Friday morning but SNPS rebounded from the lows of the session by the afternoon. We remain bearish on the stock and its P&F chart is bearish with a $14 target. Our own target is only $15.50 but we would not consider new bearish positions until SNPS traded under $16.70. We're going to turn somewhat defensive and lower our stop loss to $17.55 to reduce our risk. More aggressive traders may want to leave SNPS room to maneuver and put their stop above the $18 mark.


 

Picked on January 21 at $16.95
Gain since picked: + 0.17
Earnings Date 02/17/05 (confirmed)
Average Daily Volume: 1.5 million

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