Long Play Updates
Adobe - ADBE - close: 46.27 change: -0.84 stop: 43.85
Friday's market sell-off pulled ADBE to a 1.7% decline but shares remain inside their bullish pattern. Readers can watch for a bounce in the $46.00-45.25 zone as a new bullish entry point. More conservative traders may want to consider a tighter stop loss near $45.00. Our target is the $49.50-50.00 range. The P&F chart is already bullish with a $51 target. Our time frame is about six weeks.
Picked on October 09 at $45.05
Heidrick & Struggles - HSII - cls: 40.70 chg: -0.23 stop: 37.99
HSII held up pretty well during Friday's market collapse. The stock is still struggling with technical resistance at its 50-dma but it has been holding above the $40.50 level. We suspect that HSII will dip toward $40.00 again and readers can wait for the dip or a bounce there as a new bullish entry point. We are considering a higher stop loss maybe somewhere in the $39 region. Our target is the $44.00-45.00 range. We do not want to hold over the end of October earnings report. FYI: Looking at the daily chart we have to admit that HSII could be building a short-term (bearish) double-top pattern (see chart below).
Picked on October 14 at $40.20
Lexmark - LXK - close: 42.35 change: +0.33 stop: 41.06 *new*
LXK managed to out perform the markets on Friday by posting another gain. Shares are building a relatively steady pattern of higher lows, which is bullish. Unfortunately, Monday is our last day. We plan to exit at the close on Monday to avoid holding over LXK's earnings report on Tuesday morning. The target we have been shooting for was $44.85-45.00. Please note that we're adjusting the stop loss to $41.06.
Picked on October 09 at $41.06
Sirius Satellite Radio - SIRI- cls: 3.55 change: -0.11 stop: 3.29
Ouch! SIRI lost 3% in profit taking on Friday. Furthermore Friday's session has produced a bearish engulfing reversal candlestick pattern. More conservative traders may want to tighten their stops toward $3.49. We're adjusting the stop loss to $3.34. We are not suggesting new positions in SIRI at this time. Keep an eye on the $3.50 level, which should be short-term support. This remains a very speculative, higher-risk play. Our target is the $3.95-4.00 range.
Picked on September 30 at $ 3.49
Short Play Updates
Apria Healthcare - AHG - cls: 23.20 change: -0.36 stop: 25.31*new*
Volume was pretty light for AHG on Friday but that didn't stop the stock from sliding toward its lows. We're not suggesting new positions at this time. We are going to tighten our stop loss to $25.31. Our AHG target is the $22.50-22.00 range. We do not want to hold over the October 30th earnings report. FYI: AHG has relatively high short interest. The latest data puts short interest at more than 15% of the 43.3 million-share float. This raises the risk of a short squeeze.
Picked on October 14 at $25.31
Pacific Ethanol - PEIX - cls: 8.25 change: -0.58 stop: 9.75
We're starting to see some movement in shares of PEIX. The stock plunged over 6.5% and hit new multi-year lows on Friday. The close under the late September lows is definitely bearish. Contributing to the move was one analyst firm starting coverage on PEIX with a "sell" rating. More conservative traders may want to adjust their stop loss toward the $9.15-9.10 area. Our target is the $7.75-7.50 range. Readers should note that the most recent data puts short interest at more than 16% of PEIX's 34.2 million-share float, which would raise the risk of a short squeeze.
Picked on October 14 at $ 9.03
Closed Long Plays
Computer Sciences - CSC - cls: 56.95 chg: -0.76 stop: 55.95
Shares of CSC were upgraded from an "under perform" to a "neutral" on Friday but shares failed to keep any strength on the news. The stock produced another failed rally near $58.00. CSC should still have support near $56.00 but we're suggesting an early exit now to cut our losses.
Picked on October 14 at $59.18
Cisco Systems - CSCO - cls: 31.50 change: -1.18 stop: 31.65
Friday proved to be a rough day for CSCO. The stock was weak right from the open and never recovered. Shares lost 3.6% with the breakdown accelerating into the closing bell. The stock slipped through what should have been support near $31.90 and its 50-dma. CSCO hit our stop loss at $31.65 closing the play.
Picked on September 26 at $32.65
Juniper Networks - JNPR - cls: 35.62 change: -1.30 stop: 34.69
We are going to abandon ship with JNPR. The Networking index broke down under support thanks to CSCO and with only a few days left before JNPR reports earnings it looks like exiting early is the best move. We would keep an eye on the $35 level and JNPR's 50-dma as potential support and see what happens after the company reports on October 23rd.
Picked on October 07 at $37.04
Plexus - PLXS - close: 27.32 change: -0.83 stop: 27.49
We were right to be cautious on PLXS. The stock hit our trigger to open the play on Wednesday but the move looked like a failed rally attempt. On Friday the market weakness pulled PLXS to a 2.95% decline and shares hit our stop loss at $27.49. PLXS now looks poised to trade lower toward $26.00.
Picked on October 17 at $29.05
Rowan Companies - RDC - cls: 37.80 change: -1.68 stop: 37.99
A huge post-earnings sell-off in Schlumberger (SLB) sparked some very heavy selling in the oil service stocks. RDC lost 4.2% and broke down under what should have been support at $38.00. RDC hit our stop loss at $37.99.
Picked on October 14 at $40.18
World Acceptance Corp. - WRLD - cls: 32.14 chg: -1.23 stop: 31.99
Investors are running from the financial sector. WRLD had been showing some relative strength but that vanished in the last couple of days. On Friday the stock lost more than 3% although it did so on low volume. WRLD hit new one-month lows and is now testing technical support at the 50-dma. There is a chance that WRLD will bounce from here near $32.00. We are not counting on it and suggesting an early exit.
Picked on October 09 at $33.93
Zoltek - ZOLT - cls: 42.20 change: -3.22 stop: 42.90
Whoa! What happened to ZOLT? We did not see any specific news that might account for the stock's weakness. Shares plunged after the opening bell and eventually closed down just over 7% and on strong volume. Our unrealized gains just vanished in a couple of hours. ZOLT hit our stop loss at $42.90.
Picked on September 24 at $43.06
Closed Short Plays