Long Play Updates
Electro Sci. Ind. - ESIO - close: 17.77 chg: -0.16 stop: 16.79
ESIO is a new play we added to the bullish candidates list on Thursday night. Shares held up pretty well on Friday considering the 1.5 percent decline in the NASDAQ Composite. A reprint of the original play follows and readers will note there are alternative entry points suggested:
We like ESIO as a technical bounce play. The stock is very oversold after two months of steady declines. Now shares are bouncing from strong support. Today's gain pushed ESIO above technical resistance at its 10-dma. Technical oscillators like the RSI and stochastics have turned positive and its MACD is nearing a new buy signal. The P&F chart is currently bearish but we believe the broad market rally will continue and help lift shares of ESIO toward the $20.00 level. We are suggesting longs at current prices but readers have a choice. You could look for a possible dip back toward $17.50. Or you could look for more confirmation and only go long if ESIO trades over $18.25-18.50. Our target is $20.00 and our time frame is about six weeks.
Picked on April 21 at $17.93
Knightsbridge Tankers - VLCCF - cls: 42.55 chg: +0.45 stop: 38.90*new*
Crude oil continued to climb on Friday and that lifted the oil stocks and oil tankers like VLCCF. Shares of VLCCF closed at another new high and the stock looks poised to run towards our target range of $44.00-45.00. The stock has a positive Point & Figure chart with a bullish triangle breakout buy signal that currently points to a $70.00 target. If VLCCF surprises us with a dip the $40.00 and $41.00 levels should act as support. Readers could use a dip to either, especially the $41.00 level, as a new bullish entry point. We're going to raise our stop loss to $38.90.
Picked on April 19 at $40.31
Short Play Updates
BEA Systems - BEAS - close: 7.13 chg: -0.08 stop: 7.71 *new*
BEAS is inching closer and closer to our target at the $7.00 level. The stock lost another 1.1 percent helped in part by a very weak NASDAQ on Friday. The short-term consolidation is one of lower highs and suggests that BEAS could actually breakdown under the $7.00 level. More aggressive players may want to keep the play open but we do plan to exit at $7.00. Actually more conservative traders could exit here for a profit. We are going to lower our stop loss to $7.71. We are not suggesting new bearish entries at this time.
Picked on April 15 at $ 7.68
Boston Scientific - BSX - cls: 29.35 chg: +0.06 stop: 31.51
We added BSX to the bearish candidate list this past week due to its long-term and short-term weakness. The stock has been withering under a pattern of lower highs for months. Investors did not respond very well to BSX's earnings report this past week either and the technical picture looks murky. The Point & Figure chart shows a quadruple bottom breakdown sell signal with a $22 target. We are targeting a drop into the $25-24 range. Readers can use a bounce to and failed rally at the $30.00 level, which should be overhead resistance, as a new bearish entry point.
Picked on April 19 at $29.05
Flextronics - FLEX - close: 11.21 chg: -0.07 stop: 11.76
Time is running low for our short play in FLEX. The stock broke back above the $11.00 level on Thursday's big market bounce but there was no follow through. That's the good news. The bad news is that we're running out of time. FLEX is due to report earnings on Thursday, April 28th and we do not want to hold over the report. Plus, this week also brings us the semiconductor billings data. Our plan is to exit on Wednesday afternoon. However, we are going to adjust our exit/profit target from $10.25-10.00 to $10.50. Readers can seriously consider exiting if FLEX trades anywhere near $10.50 again. We will. More conservative traders may want to tighten their stops.
Picked on March 16 at $11.95
Greenbrier Co - GBX - close: 31.58 chg: -0.76 stop: 34.25
Good news! Shares of GBX saw no follow through on Thursday's rally and the whole move has produced a failed rally at the $34.00 level and its 21-dma. In the news on Thursday GBX announced a secondary offering of 4.5 million shares. That's a huge amount when you consider there are only 15 million shares outstanding and only 6.3 million shares in the float. Investors hate to have companies dilute their holdings and the reaction would have been much more negative but GBX plans to use the money from the second offering to buy more than 3 million shares from company insiders. We remain bearish and are encouraged to see the Dow Jones Transportation index fall back below its 200-dma. Our target remains the $30-28 range.
Picked on April 11 at $33.20
Lowes Companies - LOW - cls: 51.88 change: -0.40 stop: 54.01
Shares of LOW continue to look weak but the stock is certainly in an oversold condition, which means it is overdue for a bounce. Short-term traders may want to consider exiting early here for a gain. Our target remains the $51.00-50.00 range and we are not suggesting new bearish positions.
Picked on April 10 at $54.81
Catalina Mktg - POS - close: 24.21 chg: -0.51 stop: 25.25
The play is now open. Shares of POS dipped under the $24.00 level and under our entry point at $23.80 on Friday. The stock traded under its 200-week and 50-week moving averages as well before bouncing back in the last 30-minutes of trading on Friday. As bears on the stock we're not happy to see the bounce back but given the overall bearish trend in the major averages and the technical breakdown in POS below the $25.00 level and its 200-dma's the stock should continue lower. The P&F chart's sell signal points to a $16 target. We would watch for the bounce in POS to carry the stock toward $24.75 before it rolls over again. Traders could use just such a move as a new bearish entry point. More conservative types may want to sit back and look for a new relative low under $23.70 before initiating positions. Our target is the $21.25-21.00 range.
Picked on April 22 at $23.80
Sina Corp - SINA - close: 26.95 chg: -0.46 stop: 30.01 *new*
Chinese Internet stock SINA continues to look like a tempting bearish candidate in spite of a week full of strong earnings news from the Internet's heavy weights like YHOO, EBAY and GOOG. Shares of SINA produced a failed rally at its 200-dma on Wednesday and Friday's early morning bounce also failed. This looks like a new bearish entry point for traders. However, keep in mind that our short-term target is the $25.00 level. We are lowering the stop loss to $30.01.
Picked on April 13 at $28.52
Westlake Chem. - WLK - close: 27.40 chg: -0.01 stop: 30.01
We do not have much new to report on for WLK. The stock continues to slowly trend lower. Shares are somewhat oversold and due for a bounce but thus far the 10-dma is holding as overhead resistance. We're going to leave our stop loss at $30.01 today but more conservative traders may want to consider tightening their stops. We are not suggesting new bearish plays. Our target is the $25.50-25.00 range.
Picked on April 08 at $29.19
West Marine - WMAR - close: 19.99 chg: -0.15 stop: 20.75*new*
Prepare to exit. The good news here is that WMAR continues to show relative weakness. The stock closed under the $20.00 level for the first time since last October. The bad news is that we're running out of time. WMAR is due to report earnings on Thursday, April 28th. We plan to avoid holding over earnings by exiting on Wednesday afternoon. We are going to adjust our target to be $19.50 and our stop loss to $20.75.
Picked on March 17 at $21.20
XM Satellite Radio - XMSR - cls: 26.53 chg: -0.98 stop: 30.01
XMSR is almost there! The stock performed another failed-rally, this time at its simple 10-dma, on Friday. Shares lost more than 3.5 percent to close near its lows for the week. The action looks pretty sour and XMSR is not far away from our exit/profit target in the $26.00-25.00 range. We're not suggesting new bearish plays at this time with XMSR so close to our target. More conservative traders may want to tighten their stops or even consider exiting now for a profit.
Picked on April 10 at $30.67
Closed Long Plays
Closed Short Plays