Long Play Updates
Arrow Elec. - ARW - close: 34.74 chg: -0.01 stop: 33.74
The trading in ARW was a bit disappointing. Shares gapped open at $35.30 and then gave it all back to close virtually unchanged. We did not see any specific news behind this morning's gap higher. Readers may want to wait and watch for a dip (or better yet a bounce) closer to the $34.00 level. If Intel sells-off on its earnings news tonight it could easily weigh on the whole tech sector. Our target remains the $36.50 level near the May highs. We do not want to hold over the February earnings report.
Picked on January 14 at $34.75
Cascade - CAE - close: 52.70 chg: -2.84 stop: 52.45
CAE fails again! Shares of CAE have struggled to breakout over the $55.50 level for several weeks. We keep waiting for a breakout. We don't see any specific news to account for today's weakness (-5%) so it might be plain and simple profit taking as investors exit near the highs. Volume on today's decline was pretty strong, which is a bearish signal. If CAE doesn't bounce tomorrow we'll drop it as a candidate. Currently we're sitting on the sidelines waiting for a rally past $55.75 before suggesting any bullish positions. If triggered at $55.76 our target is the $59.75-60.00 range.
Picked on January xx at $xx.xx <-- see TRIGGER
China Mobile - CHL - cls: 43.90 chg: +1.30 stop: 39.99
Shares of CHL gapped open higher on Tuesday as the stock rushed to catch up with big gains in the Chinese stock market. Readers can choose to buy this rally or wait for a potential pull back toward the $42.50-43.00 region. More conservative traders may want to put their stop under $40.86. Our target is the $46.50-47.00 range. More aggressive traders may want to aim for $50.
Picked on January 14 at $42.60
Comcast Corp. - CMCSK - cls: 43.63 chg: +0.31 stop: 41.45
CMCSK continues to rally on strong volume. Shares almost hit the $44.00 level before consolidating back toward the $43.50 region. The MACD indicator on the daily chart has produced a new buy signal. We do not see any changes from our weekend comments. Our target is the 2000-2001 highs. We'll plan an exit in the $46.00-46.50 range. We do not want to hold over the early February earnings report.
Picked on January 14 at $43.32
Hewlett Packard - HPQ - close: 43.20 change: -0.33 stop: 39.95
HPQ endured some profit taking on Tuesday (-0.75%) after last week's late run up. If tech stocks see any selling on Intel's earnings news tomorrow we would watch for HPQ to dip toward what should be short-term support near $42.00 and its 10-dma. Readers can choose to buy the dip (or a bounce) near $42.00 as a new entry point. More conservative traders may want to tighten their stops toward $41.00. Our short-term target is the $46.00 level. We do not want to hold over the late February earnings report.
Picked on January 07 at $42.20
MedImmune - MEDI - close: 35.20 change: -0.17 stop: 32.95
MEDI under performed its peers in the biotech and drug sectors on Tuesday. Volume is fading and it looks like upward momentum is waning. We're not suggesting new bullish positions at this time. More conservative traders may want to tighten their stops further. We do not want to hold over the early February earnings report. Our target is the $36.50-37.00 range.
Picked on January 05
at $33.98 *gap open entry*
Piper Jaffray - PJC - close: 71.51 chg: -1.50 stop: 67.45
Warning! PJC produced a bearish failed rally today. The stock rallied to $74.30 early this morning before giving back all of Friday's gains. We noticed that the XBD broker-dealer index also produced a small failed rally so the sector could be poised for more profit taking. PJC's under performance today is not a good sign and more conservative traders may want to exit early! Broken resistance in the $69-70 region should act as short-term support. Our target is the $74.75-75.00 range. The P&F chart points to a $90 target (was $78 a few days ago). Please note that we do not want to hold over the January 24th earnings report.
Picked on January 10 at $69.45
Bankrate Inc. - RATE - close: 38.24 chg: +0.12 stop: 34.90
We remain cautious on RATE. It looks like shares want to move higher but volume has evaporated and shares are struggling to make it past $38.75. We remain short-term bullish but more conservative traders may want to use a tighter stop loss or wait for a rally past $38.75 before initiating positions. Our target is the $41.90-42.00 range. More aggressive traders may want to aim higher. FYI: The most recent (December) data put short interest at more than 35% of RATE's 11.2 million-share float.
Picked on January 11 at $38.25
Short Play Updates
The Andersons Inc. - ANDE - cls: 37.80 chg: -0.20 stop: 40.25
ANDE continues to under perform. The stock produced a failed rally under its simple 10-dma and 50-dma on Tuesday. ANDE looks poised to breakdown so we're going to keep it on the newsletter as a short candidate. We are waiting for a breakdown under support at the $37.00 mark. Our suggested trigger to short ANDE is at $36.99. If triggered at $36.99 our target is the $33.00-30.00 range. More conservative traders may want to widen their trigger to something like $36.95, 36.90, 36.85 just to raise the odds that we are catching a real breakdown. FYI: Traders should note that ANDE can be a volatile stock at times and the latest (December) data put short interest at 7.2% of ANDE's 14.7 million-share float. That's not a very big float and the relatively high short interest raises the risk of a short squeeze. We do not want to hold over the early February earnings report.
Picked on January xx at $xx.xx <-- see TRIGGER
Safety Ins. Group - SAFT - cls: 49.14 chg: -0.86 stop: 51.05
Tuesday's trading may have produced a new entry point for shorts in SAFT. The stock produced another failed rally/lower high under its six-week trendline of resistance. Today's session also produced a bearish engulfing candlestick pattern, which is usually seen as a bearish reversal. SAFT also closed back under the $50.00 level and its simple 200-dma. Traders may want to short the stock now. We are going to stick to our previous comments and suggest waiting for a drop under $48.50 before opening new plays. By waiting SAFT will need to trade lower under its exponential 200-dma before you initiate a position. We have two targets. Our conservative target is $45.10. Our aggressive target will be the $42.50 level. FYI: The latest (December) data put short interest at 7% of SAFT's 13.1 million-share float. That does raise the risk of a short squeeze.
Picked on January 08 at $ 48.49
Closed Long Plays
Continental Air. - CAL - close: 51.63 chg: +1.97 stop: 44.89
Target achieved. Crude oil suffered another very strong sell-off today. This helped fuel the rally in the airline sector. The XAL index rose 2.4%. Shares of CAL rose 3.9% and closed at another new multi-year high. The intraday high was $51.76 and our suggested target was the $51.75-52.00 range.
Picked on January 10 at $47.45
Sina Corp. - SINA - close: 34.02 change: +0.67 stop: 29.99
Target achieved. While the U.S. markets were closed on Monday the Chinese market continued to rally. When SINA opened for trading the stock shot higher and closed with a 2% gain. The high today was $34.23. Our target was the $34.00-35.00 range.
Picked on January 04 at $31.06
Closed Short Plays
Guitar Center - GTRC - close: 45.07 change: +1.18 stop: 44.55
We have been stopped out of GTRC at $44.55. Our last few updates have been more and more defensive due to GTRC's sharp rebound. It seems investors are ignoring the negative earnings news announced last week or the stock is experiencing some sort of short squeeze. Today's rally (+2.6%) is a breakout over its 50-dma and 200-dma and four-week trendline of lower highs.
Picked on January 08 at $42.45