Long Play Updates
Basic Energy - BAS - close: 25.84 change: -0.11 stop: 24.99*new*
The rally in BAS stalled on Tuesday as crude oil futures fell over a dollar to close under $59 a barrel. Don't forget that this is a very short-term play and we plan to exit on Wednesday, November 8th at the closing bell to avoid earnings the next day. We're raising the stop loss to $24.99. Our target is $27.50.
Picked on November 05 at $25.30
ENSCO - ESV - close: 50.93 change: +0.26 stop: 47.75 *new*
ESV displayed relative strength on Tuesday with a 0.5% gain. Traders bought the dip multiple times in the $50.15-50.20 region and that could bode well for tomorrow. We're inching up our stop loss to $47.75. ESV should find support at its rising 10-dma near $49.00. Our multi-week target is the $54.50-55.00 range. Be prepared for some resistance and a likely pull back near $52.50.
on November 05 at $50.23
Hess Corp. - HES - close: 43.92 chg: -0.97 stop: 39.99
Warning! HES has produced a bearish reversal with today's bearish engulfing candlestick pattern. The weakness may be due to negative analyst comments from Lehman Brothers. More conservative traders may want to exit early right here to avoid or limit losses. If HES does pull back you could always re-enter on a bounce near $42.00, which is where we'd expect HES to find support. Our target is the $48.00-50.00 range over the next several weeks.
Picked on November 05 at $43.85
Short Play Updates
INVACARE - IVC - close: 22.02 change: +0.18 stop: 23.11
We have to wave the yellow caution flag on IVC. The stock broke out over its 10-dma and broke out over the $22.00 level. Broken support at $22.00 was supposed to act as overhead resistance and it did act as resistance for the past few days. The bounce today did reverse itself near $22.50 but there's no way to know if the oversold bounce is over. We'd wait for a new decline under $21.95 before considering new positions but traders may want to think twice about opening new short positions if the major averages are still posting gains. Our target is the $20.05-20.00 range. More aggressive traders may want to aim lower.
Picked on October 30 at $21.94
Joy Global - JOYG - close: 39.42 chg: +0.32 stop: 40.65
Shares of JOYG just posted their fourth gain in a row but it might end up being a new entry point for shorts. The rally stalled under the $40.00 mark and its two-week trendline of lower highs, which suggests that this may end up being a lower-risk entry point for new plays. Furthermore after the bell JOYG announced they were issuing $400 million in new debt. Now we didn't see a lot of after hours trading in JOYG so we can't tell what the market thinks about that news. We suspect the reaction may be negative. We do expect a bounce on the initial test of the $35.00 level. Our target is the $33.00-32.00 range. FYI: The latest (October) data put short interest at 3.4% of JOYG's 118 million-share float.
Picked on November 01 at $37.35
Monster Worldwide - MNST - close: 41.10 chg: +1.04 stop: 41.65
Warning! We were ready to hit the eject button in MNST after today's 2.59% gain. There doesn't appear to be any specific news to account for the stock's strength today. Technically the move is turning short-term indicators higher and today's rally is a breakout over its two-week trend of lower highs. The only reason we're not exiting early right here was due to news after the closing bell tonight. MNST announced its was delaying its 10Q and some believe it's because they may need to restate earnings due to questionable executive stock option grants. MNST was trading down near $40 in after hours. More conservative traders may still want to exit at their earliest convenience since there is no guarantee that tonight's after hours weakness will translate into losses tomorrow. FYI: The latest (October) data put short interest at 3% of MNST's 116 million-share float.
Picked on November 01 at $39.60
Rambus Inc. - RMBS - close: 16.51 change: -0.10 stop: 17.25
RMBS is under performing its peers in the semiconductor sector. The stock produced a failed rally at the $17.00 level today and closed with a 0.6% loss. We are still waiting for a breakdown under support at $16.00 before suggesting new positions but more aggressive traders may want to consider new plays here. Our trigger to open positions is at $15.90. If triggered our target is the $12.50 level. More aggressive traders may want to aim for the August lows closer to $10.00. Be advised that RMBS is very active in various legal battles over patents and intellectual property and bears (and bulls) are constantly at risk for an unexpected headline sending the stock surging one way or the other. More conservative traders may want to avoid this play. FYI: The latest (October) data put short interest at 6.4% of the 85.3 million-share float.
Picked on October xx at $xx.xx <-- see TRIGGER
Toll Brothers - TOL - close: 28.04 chg: -0.01 stop: 30.05
Ouch! Today's gap down in TOL produced a bad fill or entry point on our short play. The company reported preliminary revenues for the fourth quarter and the results were negative due to a high number of cancellations. The company's conference call was negative suggesting there is still no end in sight for the slow down. Pounding the point home even harder fellow builder BZH issued lower guidance for the current quarter with its report today. Considering the news we don't see why the stock rebounded back toward unchanged. Our suggested entry point was $27.95 but we have to take today's open at $27.60. Now that the play is open our target is the $25.25-25.00 range. We do not want to hold over the early December earnings report. FYI: The P&F chart is still bullish for TOL and shares can trade to $25 and not break the current buy signal. Traders should also note that the latest (October) data put short interest at 15% of TOL's 114.9 million-share float. That's a high amount of short interest and increases the chance of a short squeeze should TOL suddenly move higher.
Picked on November 07 at $27.60
Texas Instruments - TXN - close: 29.74 change: +0.00 stop: 31.15
We found the trading in TXN to be very interesting. The SOX semiconductor index and SMH holders were up strongly today. Yet TXN's bounce failed at $30.19 and the stock was plunging lower late this afternoon. The move in TXN looks like a failed rally at its descending 10-dma. The move could be used as a new entry point for shorts but we would hesitate to open new positions with the major indices still showing so much strength. Our target is the $27.50 mark.
Picked on October 27 at $29.90
Closed Long Plays
Closed Short Plays