Long Play Updates
Amphenol - APH - cls: 36.66 change: +0.22 stop: 34.69
APH has produced a bullish breakout to a new high. Friday's rally over resistance near $36.50 looks like a breakout above the neckline to an inverse (bullish) head-and-shoulders pattern. Our only complaint would be the lack of volume on Friday's move to really confirm it. Readers can choose to buy the breakout here or look for another dip near $36.00. Our target is the $39.75-40.00 range.
Picked on June 10 at $35.74
Aracruz Celulose - ARA - cls: 66.13 chg: +1.81 stop: 59.90
The Brazilian markets are muy caliente. The Bovespa index rose another 805 points on Friday for a 1.5% gain. Shares of ARA soared 2.8% to a new all-time high. More conservative traders may want to think about taking some profits here. We're not suggesting new positions at this time. Our target is the $68.00-70.00 range.
Picked on June 03 at $62.00
EMC Corp. - EMC - close: 17.35 change: +0.34 stop: 16.24 *new*
Shares of EMC produced a nice bullish reversal this past week and the breakout over the 10-dma and the early June highs looks pretty strong. We're raising our stop loss to $16.24. Our target is the $18.50-20.00 range.
Picked on May 27 at $16.46
Raytheon - RTN - close: 56.54 chg: +0.13 stop: 54.85 *new*
Traders bought the dip near $55.25 twice in the last several days. That might be enough of a springboard to launch RTN to new highs. We are suggesting new positions here but RTN appears to have short-term resistance near $57.00. Please note that we're raising our stop loss to $54.85. Our target is the $59.75-60.00 range but more aggressive traders may want to aim higher. We don't want to hold over the late July earnings report.
Picked on June 03 at $56.17
St. Mary Land - SM - cls: 39.51 chg: +0.86 stop: 36.95
Another rise in crude oil lifted the energy stocks. Friday witnessed the OIX oil index and OSX oil services index rally to new all-time highs. Shares of SM joined the rally and surged 2.2% to breakout over short-term resistance near $39.00. We would still consider new bullish positions here or on a pull back above $38.00. Our target is the $43.50-44.00 range. The P&F chart is bullish with a $48 target.
Picked on June 04 at $38.51
Encore Wire Corp. - WIRE - cls: 30.00 chg: +0.43 stop: 28.49
WIRE is still struggling with the $30.00 level. Shares traded above this level of resistance more than once on Friday but at the end of the day the tug-of-war ended in a stalemate. However, the bulls definitely seem to be gaining a tiny bit of momentum. WIRE does have a slow trend of higher lows. Readers have a choice. You could by Friday's rally (+1.4%) or wait for more confirmation. We're turning more optimistic here but it might pay off to wait for a rise past $30.45 first before launching positions. The Point & Figure chart suggests a $46 price target. We are targeting the $32.50-33.00 range.
Picked on May 27 at $29.26
Short Play Updates
AMB Properties - AMB - cls: 56.33 change: +0.41 stop: 58.26
Several REITs managed some significant bullish reversals this past week thanks to a few well-timed takeover rumors. AMB was not one of them. The stock has produced something of an oversold bounce but the bulls seem to be struggling with each gain. The larger pattern for AMB is bearish with a large head-and-shoulders pattern built over the last several months. The initial breakdown under the neckline reversed but that failed near $60 and its 50-dma. Friday's trading sort of looks like a failed rally that could be used as a new entry point. Yet we would probably wait for a new decline under $55.60 before launching into new shorts. Plus, if the major market indices like the Dow Industrials or the S&P 500 breakout to new highs we would hesitate to open new bearish positions. Our target for AMB is the $52.00-50.00 range.
Picked on June 11 at $ 56.21
Bolt Tech. - BTJ - cls: 40.32 chg: +0.52 stop: 42.11 *new*
Warning! BTJ has broke out over what should have been resistance at the $40.00 level. More conservative traders may want to abandon positions now and cut their losses. We strongly considered an early exit, especially with the oil service index hitting new highs. However, the rally on Friday gave back most of its gains and the stock failed to breakout over the 50-dma. We would expect any future bounce to find resistance near $42.00. Please note we're adjusting our stop loss to $42.11 just to give BTJ a little more room. We are not suggesting new shorts until BTJ trades under $39.50 again. Our target is the $35.50-35.00 range.
Picked on June 11 at $ 39.16
Broadcom - BRCM - cls: 31.32 change: +0.85 stop: 31.65
Traders decided to do some buying in BRCM on Friday. After more than two weeks of consolidating along support near $30.00 the stock rose 2.7% and broke above short-term resistance near $31.00. We're still on the sidelines. It is our plan to short the stock on a breakdown with a trigger at $29.75. We're going to keep BRCM on the play list for now and we'll watch to see if shares roll over under heavier resistance near $32.00 and its 200-dma. If BRCM can breakout over $32.00 we might want to switch directions and go long. If triggered our target is the $27.00-26.00 range. We do not want to hold over the mid July earnings report. FYI: One of the larger risks with shorting BRCM will be any sort of headline-making news events in the legal battle between BRCM and QCOM.
Picked on June xx at $xx.xx <-- see TRIGGER
Continental Airlines - CAL - cls: 33.09 chg: -0.82 stop: 36.26
Fright brought some good news for the airline bears. The sector struggled as oil rose toward $68 a barrel. Meanwhile for CAL, the stock failed to see any follow through on its bounce from Thursday. Weighing on the stock was an analyst downgrade to "neutral" from a "buy". This could be another entry point for shorts although you might want to tighten your stop loss toward the 10-dma approaching $35.00. Our target is the $30.50-30.00 range. We do not want to hold over the mid July earnings report. FYI: Keep an eye on oil prices. A sell-off in oil could prompt some buying in the airlines.
Picked on June 12 at $34.10
CIT Group - CIT - cls: 58.08 chg: -0.09 stop: 60.05
CIT continues to under perform the market. Shares completely ignored the broader-market's three-day rally this past week. We continue to suggest shorts with the stock under $59.00. Our target is the $55.25-55.00 range. We are suggesting a stop loss at $60.05 but more conservative traders might want to use $59.65.
Picked on June 12 at $58.17
Healthcare REIT - HCN - cls: 41.32 chg: +0.25 stop: 43.01
The oversold bounce in healthcare REIT HCN has failed to see any follow through higher. That's good news for the shorts. If the major market averages like the Dow Industrials and the S&P 500 roll over under resistance we would launch new shorts in HCN this week. There is potential support near $40.00 but our target is the $38.50-38.00 range. More conservative traders may want to use a tighter stop loss.
Picked on June 11 at $ 41.73
Monster Worldwide - MNST - cls: 44.96 chg: +0.15 stop: 46.26
Investors can't decide where to go with MNST. The stock has been trading sideways in a narrow range the last two sessions. If you're bearish then that's a positive sign that MNST wasn't participating in the market's three-day rally. However, if the markets continue to rally we would expect MNST to break higher. Aggressive traders may want to consider new shorts right here. We would wait for a new relative low under $44.25 or under $44.00. Our target is the $40.50-40.00 range.
Picked on June 12 at $44.41
Staples Inc. - SPLS - cls: 24.99 chg: +0.41 stop: 25.55 *new*
SPLS turned in a bullish session on Friday with a breakout over resistance near $24.75. Volume came in pretty strong, which is a warning sign for the bears. However, we're not willing to abandon ship just yet. The Friday rally failed under its descending 50-dma. Plus, the stock's strength failed to breakout over the trendline of lower highs. We are going to adjust our stop loss to $25.55. Traders can choose to look for a new decline under $24.50 or under $23.80 before considering new shorts.
Picked on May 27 at $24.40
U S T Inc. - UST - close: 53.12 chg: +0.51 stop: 55.01 *new*
We don't see any significant changes from our previous comments on UST. We're not suggesting new positions. The stock did bounce on Friday but shares remain in a bearish pattern. UST has already hit our target in the $52.60-52.50 range. Now we're aiming for the $50.50-50.00 zone. Please note that we're inching the stop down to $55.01.
Picked on May 23 at $54.96
Closed Long Plays
Fomento Economico - FMX - cls: 39.35 chg: +0.09 stop: 37.99
We are cutting our losses in FMX. The stock has been slowly creeping higher and struggling with resistance near $40.00. We would rather exit now and keep an eye on it for a breakout over $41.00 down the road. More aggressive traders may want to let it ride since the stock does have support near $38.00.
Picked on June 03 at $40.44
Closed Short Plays
IAC/InterActive - IACI - cls: 34.35 chg: +0.59 stop: 34.35
IACI hit our stop loss at $34.35 pretty early on Friday. The stock short higher as investors reacted to potential news that Expedia.com (EXPE), the online travel site, might go private. EXPE later came out and said the rumors were untrue. IACI continues to look vulnerable under $35 and its 200-dma but we're not suggesting new plays at this time.
Picked on June 12 at $32.96