Long Play Updates
ANSYS Inc. - ANSS - close: 42.69 change: -0.79 stop: 41.49 *new*
On Thursday we mentioned that ANSS looked like it was headed toward the $43.00-42.50 level but that doesn't make the decline any more palatable. The stock lost another 1.8% on Friday. Furthermore the decline is looking more and more bearish and less like an overbought pullback, especially after the December 27th bearish engulfing candlestick. We are not suggesting new long positions at this time. Instead we're raising our stop loss to $41.49 just under the 50-dma. More conservative traders may want to put their stop under 4$2.00 or exit altogether. We may choose to exit early and cut our losses if ANSS doesn't bounce in the next day or two. We do not want to hold over the early February earnings report.
Picked on December 22 at $44.05
CenturyTel - CTL - close: 33.16 change: -0.36 stop: 32.75
It maybe time to start looking for an exit. CTL could not escape the market's weakness on Friday and shares fell over one percent to close near short-term support at the $33.00 level. This pull back is also a test of support with its two-month trend of higher lows. We are not suggesting new long positions here. More conservative traders may want to exit early or raise their stops toward $33.00.
Picked on December 12 at $33.55
Duke Energy - DUK - close: 27.51 change: -0.09 stop: 26.89
Utility stocks in general have not fared that well over the past couple of weeks. DUK is suffering a double-whammy given its exposure to natural gas yet the stock isn't really suffering that much. Instead DUK has been consolidating sideways. If the market averages do turn lower we'd expect DUK to follow. Therefore we're not suggesting new positions at this time. Our target is the $27.95-28.00 range.
Picked on December 13 at $26.89
Levitt - LEV - close: 22.74 chg: -0.46 stop: 21.95
LEV also fell victim to the market's downdraft. Shares consolidated sideways along the $23.00 level until late Friday afternoon then LEV turned lower on a couple of volume spikes. Short-term technical oscillators have turned negative. We are not suggesting new long positions at this time. More conservative traders may even want to tighten their stops toward $22.20. We are leaving our stop under $22.00. Our target is the $24.90-25.00 range.
Picked on December 01 at $22.27
LifeCell Corp. - LIFC - close: 19.05 change: +0.19 stop: 19.24
Hmm... in Thursday's update we said that we might drop LIFC as a bullish candidate if shares traded under $18.50 on Friday. The stock did trade under $18.50 (low 18.45) but the stock rebounded sharply Friday afternoon while the rest of the market was falling. Since we remain on the sidelines and not at risk we're going to give LIFC another day or two to shape up. Our trigger to go long the stock is at $20.65. If triggered we'll target a rally into the $24-25 range. The P&F chart is still bullish with a $29 target. We do not want to hold over the late January earnings report.
Picked on December xx at $xx.xx <-- see TRIGGER
Norfolk So. Corp. - NSC - close: 44.83 chg: -0.13 stop: 42.34
We have mixed feelings about NSC. The stock remains a strong momentum candidate. Shares have been climbing in a steady, rising channel for months now and are currently trading near their highs. Unfortunately, this last week has seen two failed rallies under the $46.00 level. Plus, Jim's market wrap from several days ago reminded us that January tends to be pretty bearish for the transportation sector. After months of gains and some end-of-quarter window dressing it would not be a surprise to see investors big and small lock in some profits in the next few weeks. We're going to keep the play open for now. A bounce from the $44.00 level would look like a new bullish entry point but do so cautiously and watch your stops! Speaking of stops more conservative traders may want to tighten theirs toward the $44.00-43.50 region. We're going to tighten our stop toward the 50-dma at $42.49. Our target is the $48.50-49.00 range. The Point & Figure chart for NSC currently points to a $64 target. We do not want to hold over the late January earnings report.
Picked on December 22 at $44.35
Outback Steakhouse - OSI - close: 41.61 chg: -0.14 stop: 40.49
OSI didn't make much progress on Friday. There was an early morning rally attempt but it failed at the 200-dma near $42.00. The stock's trend of higher lows remains intact and traders looking for an entry point might want to watch for a bounce from the $41.00 level. More conservative traders may want to wait for a move over the 200-dma before considering new long positions. Our target is the $44.00-44.50 range.
Picked on December 23 at $41.55
VCA Antech - WOOF - close: 28.06 chg: -0.08 stop: 27.45 *new*
WOOF continues to consolidate sideways between the $27.50 level and the $28.50 level. If you're the optimistic type then you might notice the two-week trend of higher lows and the MACD indicator nearing a new buy signal. Given the market environment going into January we are not suggesting new plays at this time. We are going to tighten our stop to $27.45. We will plan to exit ahead of the late January earnings report. Our target is the $29.90-30.00 range.
Picked on November 09 at $26.74
Short Play Updates
Danaher - DHR - close: 55.78 change: -0.19 stop: 57.35
The good news on Friday is that DHR's relative strength from Thursday failed to produce any follow through. Overall the pattern for DHR looks bearish given the mid-December breakdown. Aggressive traders might want to think about new short positions here. More conservative traders may want to wait for DHR to trade under short-term support near $55.00 before considering new short positions. Our target for DHR is the $51.25-51.00 range.
Picked on December 18 at $55.79
Network Appliance - NTAP - cls: 27.00 chg: -0.50 stop: 28.55*new*
Technology stocks had a rough week and NTAP was no exception. The stock lost 1.8% on Friday marking its sixth down day in a row. Shares are now testing potential support at $27.00 and its simple 200-dma so we do expect some kind of bounce from here. A failed rally near $28.00 could be used as a new bearish entry point. Our target is the $25.25-25.00 range since NTAP appears to have long-term support near the $25 region. We are lowering our stop to $28.55.
Picked on December 28 at $27.70
NeuroMetrix - NURO - close: 27.28 chg: -0.02 stop: 31.05
NURO didn't change much on Friday. The stock has been consolidating its recent losses. The question now is whether or not the stock will continue lower or produce an oversold bounce back toward the $29.00-29.50 region. Our target is the $25.25 mark so we're not suggesting new positions at this time. However, a failed rally under $30 could be used as a new entry point. The P&F chart looks pretty bearish with a triple-bottom breakdown sell signal pointing to a $20 target.
Picked on December 06 at $29.59
Somanetics - SMTS - close: 32.00 change: +1.02 stop: 35.05
We suspected that the bounce in SMTS was not over yet and Friday proved us correct. The bounce may still have more to come so we are watching for a failed rally near the 50-dma (33.30) or the $34.00 level. Traders can look for new entry points there. More conservative traders may want to tighten their stops toward the $34.00 level. Our target is the $27.50-27.00 range. The biggest challenge and risk here may be the time frame. We do not want to hold over the January 11th (unconfirmed) earnings report. We may have to consider an early exit near the 100-dma (currently near 28.50).
Picked on December 29 at $32.45
Waters Corp. - WAT - close: 37.80 chg: -0.32 stop: 39.25
WAT continues to consolidate under its four-month trend of lower highs (a.k.a. resistance). If the major market averages turn lower in January then we expect WAT to follow if not lead the way down. Friday's decline looks like another entry point but more conservative traders may want to wait for a new decline under the December 20th low near $37.55 before initiating positions. Our target is the $35.25-35.00 range. WAT's P&F chart points to a $25 target. We do not want to hold over the late January earnings report.
Picked on December 18 at $38.60
Closed Long Plays
BMC Software - BMC - close: 20.49 change: -0.47 stop: 20.74
The year-end sell-off was tough on shares of BMC. The stock lost 2.2%. We have been stopped out at $20.74. The next level of support is the 50-dma near 20.17 and then historical price support near $20.00.
on December 27 at $21.11
JDS Uniphase - JDSU - close: 2.36 change: -0.05 stop 2.39
We are eliminating JDSU as a bullish candidate. The stock has closed under the $2.40 level and broken down under its simple 50-dma. It's also arguable that JDSU has broken below the bottom of its wide, rising channel. We were never triggered in the play so we drop it unopened.
Picked on December xx at $xx.xx <-- see TRIGGER
Closed Short Plays