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Long Play Updates

Burlington Coat - BCF - close: 40.48 chg: -0.09 stop: 37.45

Some of the retail stocks stumbled on Friday after an earnings warning from the Gap (GPS). Fortunately, traders bought the dip in BCF near round-number support near the $40.00 mark. The afternoon bounce looks like a new bullish entry point. Our target is the $43.50-44.00 range.

Picked on October 24 at $38.90
Change since picked: + 1.58
Earnings Date 10/06/05 (confirmed)
Average Daily Volume: 165 thousand

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Csk Auto - CAO - close: 15.50 change: +0.00 stop: 14.95

Shares of CAO did manage to breakout over its two-week trend of lower highs on an intraday basis but failed to maintain any of its gains. We are very hesitant about suggesting new bullish positions here with only two weeks left before we plan to exit. CAO is due to report earnings in early December and we do not want to hold over the report. If CAO doesn't breakout over resistance at the $16.00 level in the next five or six trading sessions we're going to exit early!

Picked on November 02 at $15.58
Change since picked: - 0.08
Earnings Date 12/02/05 (unconfirmed)
Average Daily Volume: 388 thousand

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CE Frankline Ltd - CFK - close: 12.23 chg: +0.23 stop: 9.99

Another down day for crude oil didn't stop the rally in CFK. The stock pushed over resistance at the $12.00 mark but we noticed that volume was relatively light. We remain bullish but more patient traders might want to think about waiting for a dip back toward the $11.50 region and consider an entry there. Of course there's no guarantee that CFK will dip that low any time soon. Our target is going to be the $14.75-15.00 range over the next eight weeks. We are suggesting a stop loss at $9.99 but more conservative traders might want to consider something tighter.

Picked on November 16 at $11.98
Change since picked: + 0.25
Earnings Date 10/27/05 (confirmed)
Average Daily Volume: 150 thousand

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Corning Inc. - GLW - close: 20.95 chg: +0.10 stop: 18.99

The rally in GLW has temporarily stalled under resistance at the $21.00 level but shares appeared to be coiling for a breakout higher on Friday. We're not going to suggest new positions at this time. A pull back toward the $20.00-20.25 range might offer a new entry point for longs. Our target is the $21.90-22.00 range.

Picked on November 13 at $20.11
Change since picked: + 0.84
Earnings Date 01/25/06 (unconfirmed)
Average Daily Volume: 11.8 million

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Intel Corp. - INTC - close: 25.30 chg: +0.19 stop: 23.45

The SOX semiconductor index turned in a big 2.5% gain on Friday but shares of INTC lagged behind its peers. INTC continues to struggle with overhead resistance at its simple 100-dma near the $25.50 level. We are not suggesting new positions at this time. Our year-end target is the $26.00-26.50 range.

Picked on November 06 at $ 23.99
Change since picked: + 1.31
Earnings Date 10/18/05 (confirmed)
Average Daily Volume = 51.6 million

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Komag - KOMG - close: 30.50 change: +0.13 stop: 26.99

Disk drive and storage device stocks turned in a big session on Thursday. Shares of KOMG soared through resistance at the $29.00 level, its 50-dma, and then the $30.00 mark on Thursday. Friday shares spent the session churning sideways above the $30 mark. The pattern looks pretty bullish and we would consider new longs here over $30.00. However, patient traders might want to wait and look for a dip back to the $29 level and/or its 50-dma (29.33), which should now act as new support. There have been some recent comments that KOMG could be seeing a short-squeeze. The latest data does put short interest at 27.3% of its 29.8 million shares outstanding. Our target is the $34.00-35.00 range.

Picked on November 17 at $29.21
Change since picked: + 1.29
Earnings Date 01/25/06 (unconfirmed)
Average Daily Volume: 1.3 million

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Mentor Graphics - MENT - close: 8.68 chg: +0.05 stop: 8.49

MENT remains stuck inside its four-month trading range between $7.85 and $9.00. We suspect that if the market's produce their seasonally bullish year-end rally that MENT can breakout to the upside from this consolidation. Our strategy involves a trigger to go long the stock at $9.05. If triggered we'll target a run into the $9.95-10.00 range.

Picked on October xx at $xx.xx <-- see Trigger
Change since picked: + 0.00
Earnings Date 01/19/06 (unconfirmed)
Average Daily Volume: 713 thousand

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Verifone Holdings - PAY - close: 23.70 chg: +0.03 stop: 21.95

PAY is not off to a very strong start but the pattern remains bullish. We don't see any changes from our Thursday night play description so we're reposting it here:

Last month PAY broke out from a multi-month consolidation pattern and set a string of new yearly highs. After testing round-number resistance near $25.00 traders have spent the last several days locking in profits. Today looks like a new turning point for PAY. The stock dipped back toward previous resistance, now new support near $22.00, which also happens to be near technical support at its simple and exponential 200-dma's. The sharp intraday bounce from the $22 level looks like a short-term entry point for new longs. We're going to suggest longs with the stock above $23.00. More conservative traders may want to plan an exit at the $25 level, which is resistance. We suspect that PAY could breakout over the $25 level especially if the broader market continues higher with expectations of the seasonal Santa Claus rally. We are going to set an optimistic target in the $26-27 range. The biggest challenge with this play is the time frame. We want to exit ahead of PAY's December 1st earnings report. That gives us less than two whole weeks. If we do not see a move over $24.00 in the next two or three sessions we'll probably exit early.

Picked on November 17 at $23.67
Change since picked: + 0.03
Earnings Date 12/01/05 (confirmed)
Average Daily Volume: 304 thousand

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VCA Antech - WOOF - close: 27.74 chg: +0.23 stop: 25.90

WOOF was still inching higher on Friday with a 0.8% gain. The stock is nearing short-term resistance at the $28.00 level. Friday's gain actually marks a new closing all-time high for the stock. WOOF's Point & Figure chart is pretty bullish with a $44 target. We are targeting a move into the $29.90-30.00 range.

Picked on November 09 at $26.74
Change since picked: + 1.00
Earnings Date 10/26/05 (confirmed)
Average Daily Volume: 436 thousand
 

Short Play Updates

None
 

Closed Long Plays

Patterson Companies - PDCO - cls: 35.01 chg: -7.19 stop: 39.99

We try and limit our risk by using stop losses but a gap down event like Friday makes our stops seem useless. Before the opening bell on Friday PDCO issued a surprise earnings warning. The company lowered its forecast from 35-37 cents a share to 32 cents a share. Wall Street's estimates were at 35 cents a share. The market reacted with PDCO gapping lower to open at $34.89 and closing at the $35 level. We would have been immediately stopped out at the open for a significant loss. There is no guarantee but more aggressive traders who still have long positions might want to hold them for a day or two and see if PDCO produces any sort of dead-cat bounce to exit on!

Picked on October 30 at $40.85
Change since picked: - 5.84
Earnings Date 11/23/05 (confirmed)
Average Daily Volume: 1.2 million
 

Closed Short Plays

Sanderson Farms - SAFM - close: 31.70 chg: -1.10 stop: 35.01

Target achieved! After Thursday's failed rally and lower high shares of SAFM continued to show relative weakness on Friday. The stock lost another 3.3% on above average volume and fell below our target at the $32.00 mark. We are closing the play but as we have mentioned before more aggressive traders may want to use a lower target. The $30.00 level could act as round-number support. The Point & Figure chart for SAFM points to a $21 target.

Picked on October 23 at $35.17
Change since picked: - 3.47
Earnings Date 12/07/05 (unconfirmed)
Average Daily Volume: 257 thousand
 

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