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Long Play Updates

Amer.Eagle Outfitters - AEOS - cls: 34.16 chg: -0.42 stop: 32.99

Not only did the violence in the Middle East continue to rattle the markets but the June retail sales numbers came in below estimates and that added more fuel to the fire that consumers may be slowing down. Retail stocks continued to drop on this news and shares of AEOS lost 1.2%. We considered closing AEOS early since the technical indicators are turning more bearish and the MACD on the daily chart is nearing a new sell signal. However, the RLX retail index, after several days of losses, looks ready to bounce from significant support near the 420 level. We're going to keep AEOS as an open play but we're not suggesting new bullish positions at this time. Our target is the $38.25-38.50 range. The P&F chart is more optimistic with a $63.00 target. We do not want to hold over the August earnings report.

Picked on July 06 at $34.77
Change since picked: - 0.61
Earnings Date 08/15/06 (unconfirmed)
Average Daily Volume: 2.2 million
 

Short Play Updates

Broadcom - BRCM - close: 28.13 change: +0.24 stop: 30.25

Are investors buying the bad news in BRCM? Volume has been above average for the last two days as the stock tries to rebound higher. On Friday the company pretty much confessed to option backdating and said they would need to restate six years worth of financials and take a $750 million dollar charge. Analysts seem mixed on the confession. One firm thought that this removed a black cloud hovering above the stock. Another firm downgraded the stock to a "hold" and cut their price target from $55 to $32. What we see is that short-term technicals look like they want to turn higher of course BRCM is so oversold it wouldn't take much to turn the technicals bullish again. Right now BRCM is still stuck in its bearish trend of lower highs and we would not be surprised by a bounce towards the $29.00 or $30.00 levels. More conservative traders may want to seriously consider exiting early right here - or consider tightening your stop. A move over $29.00 looks like it would be a bullish breakout above the stock's bearish channel. BRCM is due to report earnings on July 20th and we do not want to hold over the report!

Picked on July 09 at $27.75
Change since picked: + 0.35
Earnings Date 07/20/06 (confirmed)
Average Daily Volume: 15.5 million

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Centex Corp. - CTX - close: 45.80 chg: -1.57 stop: 50.05

Friday was a rough day for the homebuilders. The DJUSHB home construction index lost over 4% as investors reacted to an earnings warning from DHI. Shares of CTX gapped lower and closed with a 3.3% loss on big volume. We remain bearish on the stock but short-term it looks like CTX might try and "fill the gap" from Friday morning. Readers can wait for a rally into the $47.50-48.00 region before considering new bearish positions. We do expect some sort of bounce near the early June low (44.13) but our target is the $42.60-42.40 range. We do not want to hold over the July 24th earnings report.

Picked on July 13 at $47.37
Change since picked: - 1.57
Earnings Date 07/24/06 (confirmed)
Average Daily Volume: 2.5 million

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IAC/Interactive Corp. - IACI - cls: 24.38 chg: -0.47 stop: 26.01

The tech-stock sell-off continues to weigh on IACI. Shares lost 1.89% on Friday closing at a new four-week low. IACI is nearing our target in the $24.00-23.75 range so we're not suggesting new bearish plays at this time. We do not want to hold over the early August earnings report. Readers should note that IACI has relatively high short interest at 4.8% of its 195 million-share float. FYI: More aggressive traders may want to aim lower since the Point & Figure chart suggests a $16 target.

Picked on July 09 at $25.49
Change since picked: - 1.11
Earnings Date 08/01/06 (unconfirmed)
Average Daily Volume: 2.3 thousand

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Medtronic - MDT - close: 47.05 change: -0.45 stop: 48.75

We don't have anything new to report on for MDT. The oversold bounce is fading from a test of resistance near $48.00. Technical indicators are turning bearish again. The P&F chart points to a $36 target. More conservative traders might want to tighten their stops toward $48.25 or $48.20 or consider doing some profit taking. We continue to target a drop into the $45.50-45.00 range and we don't want to hold over the August earnings report. We are not suggesting new bearish plays at this time.

Picked on June 21 at $49.49
Change since picked: - 2.44
Earnings Date 08/22/06 (unconfirmed)
Average Daily Volume: 10.8 million

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Maxim Integrated - MXIM - close: 28.50 chg: -0.40 stop: 30.75*new*

The last couple of sessions have looked pretty similar for MXIM. Both days produced a midday rally that reversed course. Shares of MXIM lost another 1.38% on Friday to close at a new three and a half year low. We are going to lower our stop loss to $30.75. More conservative types might want to put their stop above last Wednesday's high near $30.20 or the simple 10-dma near $30.11. We have noticed that the P&F chart's bearish target has fallen from $17 to $15. Our target is the $27.00-26.75 range. We do not want to hold over the early August earnings report. More aggressive traders may want to play with a wider stop (above the 50-dma) and aim for the $25.00 region.

Picked on July 09 at $29.75
Change since picked: - 1.25
Earnings Date 08/04/06 (confirmed)
Average Daily Volume: 5.5 million

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Patterson-UTI Ener. - PTEN - close: 24.87 chg: -0.32 stop: 26.41

Our bearish play in PTEN is now open. The stock hit our trigger to short it at $24.90 on Friday morning. While PTEN closed with a 1.27% loss on Friday we're somewhat hesitant to suggest new positions again due to the bounce off its lows. Technically this is a breakdown under round-number support near the $25.00 level and the Point & Figure chart is bearish with a $20 target. Readers may want to wait for a possible bounce toward the $26.00 region. A failed rally near $25.50-26.00 could be used as a new bearish entry point for shorts. Our target is the $22.65-22.45 range. We do not want to hold over the late July earnings report. FYI: the latest data puts short interest at 4.8% of PTEN's 169 million-share float.

Picked on July 14 at $24.90
Change since picked: - 0.03
Earnings Date 07/27/06 (unconfirmed)
Average Daily Volume: 3.2 million

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XM Sat.Radio - XMSR - close: 12.89 change: -0.14 stop: 14.25

Our new bearish play in XMSR is now open. The stock continued to sink on Friday and shares broke down under support at the $13.00 level. Our trigger to open shorts was at $12.95. XMSR hit an intraday low of $12.41, which was a new three-year low, before bouncing. Friday's weakness helped push the MACD into a fresh sell signal. We would consider shorts with XMSR under $13.00 but looking at the intraday chart is looks like the stock might try and bounce toward the $13.50 region. Aggressive traders might try catching a failed rally under $13.50 as a new entry point.
Our target is the $10.25-10.00 range. We do not want to hold over the July 27th earnings report. FYI: the latest data puts short interest at 15% of XMSR's 222 million-share float. That's relatively high and increases the risk of a short squeeze.

Picked on July 14 at $12.95
Change since picked: - 0.06
Earnings Date 07/27/06 (confirmed)
Average Daily Volume: 7.7 million
 

Closed Long Plays

None
 

Closed Short Plays

Juniper Networks - JNPR - cls: 14.09 chg: -0.26 stop: 16.01

Target achieved. Weakness in tech stocks and the networking sector continued on Friday. Shares of JNPR hit an intraday low of $14.02. Our target was the $14.10-14.00 range. If you didn't exit with us don't forget that JNPR is expected to release earnings on July 19th.

Picked on June 19 at $15.89
Change since picked: - 1.80
Earnings Date 07/19/06 (confirmed)
Average Daily Volume: 13.8 million
 

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