Long Play Updates
A.G.Edwards - AGE - close: 58.25 change: -0.38 stop: 55.49
This past week was a strong one for the broker-dealer-investment stocks. The XBD index broke out to an all-time high and a bullish cup-and-handle pattern. Shares of AGE enjoyed the sector rally and broke out over resistance at $58.00 to hit its own record high. The Friday dip back toward the $58 level, which should offer some support, looks like a new entry point to go long the stock. Our target is the $62.50 level There is a chance that AGE could encounter some round-number resistance at the $60 level. However, the P&F chart has a quadruple-top breakout buy signal with a $70 target. FYI: After the closing bell on Friday AGE announced a 20-cent quarterly cash dividend payable on January 2nd, 2007 to shareholders of record on December 8th. Plus the Board of Directors announced a stock buy back plan of up to 10 million shares next year. AGE currently has 76 million shares outstanding.
Picked on November 15 at $58.15
Celadon Group - CLDN - close: 20.35 change: -0.07 stop: 17.99
Transport stocks turned in a solid week with the Dow Jones Transportation index bursting through resistance at the 4800 level. Fueling the rally in transports was a significant drop in crude oil futures and some big merger news in the airlines. Shares of CLDN, a trucking company, rose more than 4.5% last week. Friday's session wasn't so hot. The stock hit a new four-week high at $20.80 but gave back all of its gains. This looks like a short-term failed rally and we'd expect a dip back toward $20.00 and maybe the $19.75 region. Look for a bounce anywhere above $19.00 as a new bullish entry point to go long the stock. Our target is the $22.00 level. Plan for some resistance at $21.00 at least on the initial test. Conservative traders might want to consider a tighter stop loss (maybe near $18.50).
Picked on November 12 at $19.44
Heinz - HNZ - close: 43.94 change: -0.01 stop: 41.85
Traders bought the dip in HNZ on Friday at $43.45. Shares rose about 2.4% last week and look poised to push past resistance the $44.00 level soon. We have less than two weeks left for this play. HNZ is due to report earnings on November 30th and we don't want to hold over the announcement. If you're considering new positions take into account the time frame. Right now we would not consider new plays but a dip or bounce near the $42.50 region might qualify as a new entry point. Our target is the $46.50-47.00 range. FYI: More conservative traders may want to tighten stops toward the $42.50 region. Currently the P&F chart points to a $56 target.
Picked on November 08 at $43.20
Thor Industries. - THO - close: 44.53 change: -0.17 stop: 41.99
THO suffered a bout of indecision on Friday. At first the stock dipped to $43.82 only to bounce and hit a new two-week high. Yet the highs didn't hold and shares traded back into the red by the closing bell. The breakout over resistance at $44 last week is bullish and it follows a bullish double-bottom near $42. The daily chart's MACD indicator has also turned positive. We would consider new positions here but it looks like we might get a chance to buy the dip near $44 on Monday. Our target is the $47.85-48.00 level. near the October peak.
Picked on November 15 at $44.25
VeriSign - VRSN - close: 23.34 change: -0.16 stop: 20.99
The last few days we've been warning readers that VRSN was due for a pull back to consolidate its gains. Shares finally began to pull back on Friday with a minor 16-cent decline. The dip may not be over yet. If you're looking for a new entry point a dip to $23.00 or $22.50 could be used as a new entry point to go long. Our target is the $24.90-25.00 range. FYI: More conservative traders might want to adjust their stop loss closer to the $22 level, which should now act as support (22.00-22.50).
Picked on November 13 at $22.51
Short Play Updates
Closed Long Plays
HARSCO - HSC - close: 80.74 change: -0.39 stop: 79.90
We are suggesting an early exit in HSC. When we first listed this play it was our plan to go long on a breakout over resistance at the $83.00 level. A few days later the bounce from support near $80 and its rising 50-dma and 200-dma looked like an attractive entry point so we adjusted our plan. Unfortunately there has been no follow through higher and HSC has been displaying relative weakness as the major averages hit new relative highs. Our Thursday update said that if we didn't see a bounce on Friday we were going to drop the stock. There is still a chance that HSC will bounce near the $80 level but we don't want to risk it. FYI: The P&F chart for HSC still shows a buy signal and points to a $111 target.
November 14 at $ 81.30
Closed Short Plays
Texas Instruments - TXN - cls: 30.04 chg: -0.22 stop: 30.51
We have decided to exit early our short play in TXN. The SOX may have struggled to build on its bullish breakout last week the trend is still positive for the sector. Meanwhile the big oversold bounce in TXN has done a lot to turn the daily and weekly technicals more favorably toward the bulls. We're going to cut our losses here.
Picked on October 27 at $29.90