Long Play Updates
Dow Chemical - DOW - close: 44.88 change: +0.21 stop: 42.79
DOW is a technical buy-the-bounce from the bottom of its trading range play. Yet it's also a rebound play in the chemicals, plastics, rubber sector. The industry has been suffering as higher oil costs raise their expenses to produce. Shares of DOW fell back toward the bottom of its four-month trading range before bouncing last week as crude oil price decline. Technicals have turned bullish and this continues to look like a decent entry point for bullish positions. However, there is still a chance that DOW will retest the $43.50-44.00 range before moving higher so more patient traders can sit and watch for a better entry point.
Picked on September 07 at $44.60
Ryerson Tull - RT - close: 21.42 change: +0.05 stop: 19.49
Shares of fabricated metal producer RT continue to inch higher. Expectations that the company will benefit from the Katrina rebuilding process are pushing the stock higher. Right now RT looks short-term overbought and due for a dip. Readers looking for a new entry point might want to wait for a test of its simple 10-dma near 20.65 and buy a bounce there. The bullish Point & Figure chart points to a $26 target. Our target is the $23.50-24.00 range.
Picked on August 31 at $20.54
Radian Group - RDN - close: 51.67 chg: +0.51 stop: 49.99
RDN has continued to bounce and the technical picture is improving. After the bell on Friday Fitch Ratings said that the financial guaranty companies like RDN would probably not be hurt by hurricane Katrina. This news should help give the stock a boost on Monday. The P&F chart is very bullish with a $77 target. Our early October target is the $54.00-54.25 range.
Picked on September 07 at $51.10
Short Play Updates
Anheuser Busch - BUD - cls: 45.40 chg: +0.46 stop: 46.25
Shares of BUD are trying to rally following the bullish breakout from its trading range last week. We told readers earlier to watch for BUD to make a run towards resistance at its 100-dma near the $46.00 level. It looks like that is what the stock is trying to do. More aggressive traders can use a failed rally under $46.00 as a new bearish entry point. We are not suggesting new plays at this time. The longer-term trend remains bearish and we're targeting the $40.00 region by its October earnings report.
Picked on July
28 at $44.77
Intl Game Tech. - IGT - cls: 26.88 chg: -0.45 stop: 28.01
IGT's Point & Figure chart currently points to a $13.00 target but we're obviously not seeing a lot of follow through to the downside. The stock produced a bearish head-and-shoulders pattern back in May through July. Since then IGT has been consolidating sideways between $26.50 and $28.00. We are not suggesting new plays at this time. More conservative traders may want to consider tightening their stops closer to the simple 50-dma.
Picked on July 21 at $27.21
Royal Caribbean - RCL - cls: 41.88 chg: -0.19 stop: 44.11
RCL continues to under perform the market and its bearish trend has seen a big surge in volume the last couple of weeks. The stock is nearing our target in the $41.25-41.00 range. Upon closer inspection we are going to adjust our target to the $41.50-41.00 range. More conservative traders may want to seriously consider exiting now to lock in profits. We are not suggesting new bearish plays at this time.
Picked on July 27 at $45.50
Wal-Mart - WMT - close: 45.89 change: +0.03 stop: 46.55
We do not have much new to report on for WMT. Shares dipped to $44.90 at the open but quickly rebounded. The stock tried to breakout over the $46.00 level but failed there too. The stock remains oversold while the larger trend remains bearish. We still expect a bounce toward the simple 21-dma before any attempt to trade lower. We're not suggesting new bearish entries at this time.
Picked on August 24 at $45.95
Yahoo! Inc. - YHOO - close: 33.46 change: +0.12 stop: 34.81
YHOO is not seeing a lot of follow through on Wednesday's failed rally. That makes us feel a bit more cautious here. Shares dipped to short-term support at the $33.00 level on Friday and bounced. Considering the bullish bias on the NASDAQ Composite right now we would not suggest new bearish plays. Instead we would wait for a new relative low under $32.65 before considering new shorts on YHOO.
Picked on August 30 at $33.18
Closed Long Plays
Closed Short Plays
Yellow Roadway - YELL - close: 42.81 chg: -3.20 stop: 50.01
Target achieved. As expected shares of YELL traded lower on Friday following its Thursday night earnings warning. The stock gapped down to open at $43.58 and then traded to $41.87 before bouncing. Our target was the $42.00-40.00 range. We're closing the play per our game plan.
on September 04 at $46.88