Long Play Updates
Archstone - ASN - close: 49.92 chg: -0.22 stop: 48.74
ASN is still consolidating sideways around the $50.00 level. The lack of selling during the market's weakness can be seen as relative strength but ASN is having trouble building on any breakout attempts. The MACD on the daily chart is turning bearish while the MACD on the weekly chart is turning bullish. Meanwhile the Point & Figure chart is bullish with a triple-top breakout buy signal and a $70 target. We would wait for a move past the $50.25 level before initiating new long positions. Our target is the $53.85-54.00.
Picked on June 05 at $50.21
Potlatch - PCH - close: 38.64 chg: +0.00 stop: 36.99
We do not have anything new to report on for PCH. The stock tried to breakout past the $39.00 level on Friday and failed. The next move looks like a decline into the $38.00 region, maybe back toward support around $37.20. Given Friday's failed rally we would definitely wait for a move over $39.00 before initiating new plays. More conservative traders might feel better to wait for a breakout past $40.00 and its 100-dma (40.11). Currently our target is the $43.00-43.50 range.
Picked on June 04 at $39.39
Ryanair - RYAAY - close: 52.27 change: -0.13 stop: 49.95
We would be cautious here with RYAAY. The XAL airline index produced a failed rally pattern on Friday with a reversal under its exponential 200-dma and a decline back under its 50-dma and 200-dma. While RYAAY has been and still is out performing its peers in the airline sector a decline in the XAL index could weigh on the stock. We are not suggesting new bullish positions at this time. Our goal is the $53.90-54.00 range, where we expect RYAAY to have resistance at its trendline of lower highs (see chart).
Picked on June 08 at $51.34
Starbucks - SBUX - close: 36.61 chg: -0.18 stop: 34.98
On Friday shares of SBUX tried to breakout past $37.00 and its 50-dma but failed. Investors might be spooked by news out on Friday that SBUX is the latest company that could be sued for its high-fat content in its products. Overall we don't see any changes from our new play description on Thursday night so we're reposting it here:
We are going to switch directions with SBUX. Recently we tried to play the breakdown under technical support at its 100-dma and it did not pan out for us. Now the stock is breaking out higher from its sideways consolidation. Volume was not very impressive on Thursday as the stock hit a new three-week high. We want to see some confirmation. We are suggesting a trigger to go long the stock at $37.05. If triggered we'll target a rally into the $39.95-40.00 range. We are beginning the play with a wide (aggressive) stop loss at $34.98. This feels a little aggressive given some of the bearish trendlines on the chart below. Please note that we would be extra careful about considering new bullish positions right now. Yes the markets are bouncing but stocks were very oversold and due for a bounce. The major indices remain inside their intermediate bearish trends and the market bounce could be nothing more than a correction on the way lower.
Picked on June xx at $xx.xx <-- see TRIGGER
Watson Wyatt - WW - close: 34.23 chg: -0.48 stop: 33.80
Uh-oh! Friday's lack of follow through on the bounce from the $34.00 level and its 50-dma is bad news! Volume was WAY above average on Friday and that could suggest that a big investor has decided to get out. We are NOT suggesting new bullish positions at this time. Wait for a move past $34.85 or better (maybe $35.00) before considering new long plays. Right now, after studying the intraday charts, it looks like we will be stopped out on Monday at $33.80. If WW trades under $33.75 nimble traders might want to switch directions and short the stock! WW is sporting a double-top pattern. A 38.2% Fibonacci retracement of its October-June rally would be about $32.00.
Picked on June 15 at $34.71
Short Play Updates
Avid Tech. - AVID - close: 35.60 change: +0.46 stop: 39.01 *new*
AVID tried to bounce on Friday and while shares did close up 1.3% the upward momentum stalled at the $36.00 level. Almost everything about AVID is bearish. The stock has a consistent trend of lower highs, a bearish MACD sell signal, a bearish P&F chart, a recent breakdown under support to close at new three-year lows. Our only concern is that AVID looks short-term oversold and due for a bounce. The short-term technical oscillators are suggesting the same thing - that AVID is due for a bounce. Wait for a failed rally under $38.00 or its 10-dma as the next entry point to short the stock. More conservative traders may want to lock in some profits right here. Our target is the $32.50 mark. Please note that we are lowering the stop loss to $39.01.
Picked on June 11 at $37.35
The Geo Group Inc. - GGI - cls: 33.41 chg: -0.78 stop: 35.65
The oversold bounce from GGI's lows this past week appeared to fail on Friday at GGI's descending 10-dma. This is good news for the bears. It's hard to say if the bounce is really over. We are concerned that the weekly chart has now produced a "hammer" style bullish reversal candlestick. If shares trade under $33.25 then aggressive traders might want to short the stock with a target at $30.25 but we'd suggest a tighter stop loss. Currently our stop at $35.65 is just above the 50-dma. We're targeting the $30.25 level because the $30 mark and its rising 100-dma (30.22) will probably act as support. The Point & Figure chart points to a $22 target.
Picked on June 11 at $34.14
Blue Nile - NILE - close: 29.60 chg: +0.32 stop: 31.55
Traders need to be on alert here. NILE managed better than a one percent bounce on Friday. Shares look poised to climb toward $30.00 and potentially to the $31.00 level. The stock does look oversold so almost any strength will begin to turn the technical indicators positive. The P&F chart is bearish and points to a $15.00 target. We would wait and watch for a failed rally, preferably under $30.00, as a new entry point for shorts. Readers should remember that NILE has a high amount of short interest and that raises the risk of a short squeeze. Our target is the $25.50-25.00 range.
Picked on June 08 at $29.45
Closed Long Plays
Closed Short Plays