Long Play Updates
Canon - CAJ - close: 54.41 change: +0.12 stop: 53.45 *new*
We are two weeks into our bullish play on CAJ and the stock isn't going anywhere. Shares continue to consolidate sideways between $53.50 and $55.50. Recently we've been suggesting that traders only consider bullish positions if CAJ can trade back above the $55.00 level, which hasn't happened in several days. We're starting to turn even more cautious on the stock. If CAJ doesn't produce some upward momentum soon we'll probably close the play and look elsewhere. We are going to raise our stop loss to $53.45.
Picked on May 29 at $55.24
Caremark - CMX - close: 44.45 chg: +0.35 stop: 42.45 *new*
Strength in the drug sector and a decent market day overall on Friday helped push CMX back above its 10-dma and 21-dma. CMX is now pushing up against round-number resistance at the $45.00 level again. We remain bullish on the stock and continue to target the $47-48 range but CMX's volatility over the past couple of weeks may suggest that conservative traders should avoid it. CMX has not traded below $42.78 in about a month. We're going to raise the stop loss to $42.45.
Picked on May 09 at $43.30
Greenbrier Co - GBX - close: 29.81 change: -0.61 stop: 27.99 *new
GBX is a buy-the-bounce from the bottom of the channel type of play. After pushing back above its simple 200-dma the stock consolidated sideways for about two weeks. The recent breakout through the top of its short-term trading range and its 50-dma and the $30.00 level looked very promising. Friday's decline was a surprise considering the strength in the Dow Transportation average. We would watch for a bounce from the $29.50 level and if a bounce occurs then traders can use it as a new bullish entry point. We are going to raise our stop loss just a bit to $27.99. Our target is the $32.50-33.00 range.
Picked on June 01 at $28.67
General Electric - GE - close: 36.50 chg: +0.39 stop: 34.95
Hmm... what do we do now? Thus far we've been patiently waiting for GE to pull back into the $36.00-35.50 range so we can buy the dip. Yesterday we specifically stated that if the DJIA can breakout over the 10,600 level then GE might rally with it before we can jump in. That is exactly what we saw on Friday. GE added over one percent on very big volume but the volume was probably option expiration related. Plus the rally had already begun to fade by Friday afternoon. At this time we're going to stick to our plan and wait for GE to dip into our suggested trading range. However, you the reader may want to consider waiting for GE to dip into our entry range and then bounce back out before considering new positions. Furthermore, we're quickly running out of time on this play as we do not plan to hold over GE's mid-July earnings report. GE is not a very fast mover and it might not be worthwhile to trade the stock for such a short duration. Longer-term traders willing to hold the stock for six to twelve months may still want to consider a bullish entry point on a dip toward GE's 200-dma or better yet a bounce from GE's 200-dma.
Picked on May xx at $xx.xx <-- see TRIGGER
Georgia Gulf - GGC - close: 36.08 change: -0.33 stop: 33.49*new*
GGC continues to creep higher, showing decent relative strength and slowly breaking through overhead resistance levels. We would watch for a dip toward the $35.40 level or the $35.20 level as new bullish entry points. Our target remains the $38.50-39.50 range. We are going to raise our stop loss to $33.49 to reduce our exposure.
Picked on June 05 at $34.33
ExxonMobil - XOM - close: 60.89 change: +0.77 stop: 55.90
Crude oil continues to climb and worries over instability in Nigeria and the closure of the U.S. and British embassies did not help matters. The oil sector is breaking out to new highs and XOM is slowly trying to keep pace. Shares of XOM have broken through the $60.00 level on strong volume, which is good news. Yet it's worth noting that the stock looks short-term overbought. We would watch for a dip back toward the $60.00 level or even the $59.50 level if you are looking for a new entry point. Our target is the $63.00-64.00 range.
Picked on June 09 at $58.44
M/I Homes Inc - MHO - close: 54.30 chg: +1.49 stop: 50.98 *new*
MHO almost made it to our target on Friday. A strong earnings report from larger rival KBH and several upgrades in the group from Smith Barney helped boost the homebuilding sector to another new all-time high. Shares of MHO gapped open and traded to an intraday high of $54.70. Our target is the $55.00 level although we're going to adjust that to $54.90-55.20. We are also encouraged that MHO's gain today has put it above the trendline of potential resistance (see chart). However, the group and MHO look a little overbought so we would expect shares to fill the gap from Friday morning. Traders can watch for a dip back to the $53.00 region. We are raising the stop loss to breakeven at $50.98.
Picked on June 14 at $50.98
Nova Chemicals - NCX - cls: 32.77 chg: -1.77 stop: 31.95 *new*
Ouch! NCX had turned in a very impressive week with a rebound from the $30.50 level to a Thursday high of $34.80. Yet Friday experienced some heavy profit taking that brought NCX back below its simple 50-dma and previous resistance at the $33.00 level. This looks like bad news but it also looks like NCX has filled the gap from Wednesday morning so we are willing to give the stock another day or two to turn around again. However, we would not suggest new bullish positions until NCX traded back above $33.50 or better. Plus, we're raising the stop loss to $31.95 to reduce our exposure.
Picked on June 01 at $33.03
Sirius Satellite Radio - SIRI - cls: 6.02 chg: +0.03 stop: 5.59
We are a little disappointed that SIRI did not participate more in Friday's market bounce but tech stocks or at least many NASDAQ stocks appeared to have taken the day off. We're even more surprised at SIRI's lack of movement after learning that UBS had reiterated its "buy" rating on the stock and raised its price target to $7.40. This could be a warning sign. Thus far the stock remains stuck under resistance in the 6.10-6.11 region. We see no change in our strategy and continue to target the $6.50 level but we're not suggesting new positions at this time. We are raising our stop loss a few cents to $5.59.
Picked on May 22 at $ 5.65
Sohu.com - SOHU - close: 22.33 change: +0.64 stop: 19.99
Our aggressive momentum play in Chinese Internet stock, SOHU, continues to perform well. Shares added another 2.95 percent on Friday with volume coming in well above average. Although it is worth noting that the volume is probably related to Friday's option expiration. We are still bullish on the stock but shares are beginning to look a little extended. Traders can expect a dip back toward the simple 10-dma soon. Our target is the $24.00 level. The P&F chart currently points to a $29.00 target.
Picked on June 13 at $21.25
Short Play Updates
General Maritime - GMR - close: 41.84 change: +1.09 stop: 42.01
Our bearish play on oil tanker stock GMR is in serious jeopardy of being stopped out. Global concerns over stability in oil-producing Nigeria sent the price of crude higher on Friday. The tanker stocks, which have previously been ignoring the rising in crude, suddenly came alive again. GMR is resting just under resistance at its trendline of lower highs near the $42.00 level. We are not suggesting new bearish positions unless GMR trades back under $39.90 again.
Picked on June 16 at $39.90
Closed Long Plays
Archstone-Smith - ASN - close: 38.98 chg: +0.82 stop: 36.26
Target achieved. Another strong day for real estate-related stocks helped push ASN higher. Shares traded into and almost through our target range of $38.50-39.00. We are closing the play per our game plan. The stock is nearing resistance at its December highs so investors still holding positions should use caution.
Picked on May 06 at $36.26
Marvel Enterprises - MVL - close: 20.78 change: -0.39 stop: 20.45
We are calling it quits on MVL. The stock's relative weakness this past week has sapped our desire for the stock. Shares have been churning under new resistance at the $21.20 level. There are only three weeks left before the company's Fantastic Four movie hits theaters here in the U.S. and we would have expected any pre-opening run up in the stock to have begun already.
Picked on June 01 at $21.86
Closed Short Plays