Long Play Updates
Adaptec - ADPT - close: 3.17 change: -0.02 stop: 3.13
ADPT's momentum still looks like it's fading. We would strongly consider an early exit now to cut our losses since the market is acting so weak. However, we are going to keep the stock on the play list for now. We're not suggesting new positions at this time. Our target is the $3.65-3.70 zone. The stock can be somewhat volatile so we do consider this a higher-risk play. Our time frame is several weeks. FYI: The most recent data listed short interest at more than 7% of the 118 million-share float. Based on ADPT's average daily volume that is a lot of short interest and the stock could see a short squeeze.
Picked on May 28 at $ 3.25
BJ Services - BJS - close: 31.21 change: +0.01 stop: 29.89
The OSX oil service index did not make much progress even though crude oil gushed $5 higher. Shares of BJS followed the OSX sideways. The trend in BJS is still a positive one but we're not suggesting new positions at this time. Our initial target is the $33.00-34.00 range. The P&F chart is bullish with a $52 target.
Picked on May 28 at $30.45
Uranium Resources - URRE - close: 3.00 chg: -0.26 stop: 2.89
Our buy the bounce from support play in URRE is not off to a good start. A widespread market meltdown today let URRE collapse under its own weight (again). The stock lost 7.9% but managed to hold above the $3.00 level - at least for now. We would wait for a rebound before considering new bullish positions. More conservative traders might want to tighten their stops closer to the $3.00 level. Our short-term target is the $3.95 mark. This should be considered an aggressive play.
Picked on June 10 at $ 3.26
Williams Cos. - WMB - close: 39.17 change: +0.41 stop: 37.75
Natural gas stocks did not fare as well as the oil stocks but the trend was still up. We remain bullish on WMB. Our target is the $42.00-42.50 zone. More aggressive traders may want to aim higher. The Point & Figure chart points to $56.
Picked on May 22 at $38.40
Wal-Mart - WMT - close: 58.52 change: -1.26 stop: 56.49
The mighty WMT could not withstand the market's turmoil today. Shares lost more than 2% and we're seeing the potential for a bearish divergence between price and its MACD on the daily chart. We are not suggesting new positions at this time. WMT has exceeded our first target at $59.00. The Point & Figure chart points to a $68 target. We have a second, more aggressive target at $62.00.
Picked on May 22 at $56.05 /1st target exceeded
Short Play Updates
Amer.Capital Strat. - ACAS - cls: 28.94 chg: -1.11 stop: 32.05*new*
Financial stocks were hammered again. This time ACAS lost 3.7% and broke down under round-number support at $30.00. We are aiming for the January 2008 lows so our target is the $26.50-26.00 zone. Please note that our new stop loss is $32.05. The P&F chart is bearish with a $22 target. FYI: It is important for readers to note that ACAS has above average short interest. A lot of investors have seen the trend and they're piling on. The most recent data listed short interest at 15.5% of the 199-million share float. That is more than a week's worth of short interest and raises the risk of a short squeeze.
Picked on June 08 at $30.95
Darden Rest. - DRI - close: 30.74 change: -1.35 stop: 34.81
DRI almost hit our first target today near $30.00 but the play isn't even open yet. Shares lost another 4.2% thanks to a broad-based market sell-off. The $30.00 level is probably short-term support so expect a bounce. We are going to keep DRI on the newsletter with an entry point to short it in the $32.50-33.50 zone. Our new stop loss will be $34.55. If triggered we have two targets. Our first target is $30.10. Our second target is $27.75.
Picked on June xx at $xx.xx <-- see TRIGGER
Paychex Inc. - PAYX - close: 33.28 change: -0.06 stop: 34.87*new*
PAYX continues to slide and the intraday bounce failed at the $33 level, which is good news for the bears. We are adjusting our stop loss to $34.87. We're not suggesting new positions in PAYX at this time. Our target is the $31.00-30.00 zone. FYI: The most recent data listed short interest at 5% of the 320 million-share float. That's several days worth of short interest.
Picked on May 22 at $34.87
Patterson Cos. - PDCO - close: 32.45 change: -0.45 stop: 34.21
PDCO has broken down to a new relative low. This looks like a new entry point for shorts. Our target is the $30.50-30.00 zone. The P&F chart is bearish with a $28 target. FYI: The most recent data listed short interest at about 11% of the 98 million-share float. That is a relatively high degree of short interest for this stock.
Picked on June 03 at $33.42
Closed Long Plays
Axsys Tech. - AXYS - close: 57.40 change: -4.06 stop: 57.95
Selling picked up speed in AXYS. After more than a week of consolidating sideways above the $60.00 level, suddenly and without warning, AXYS dropped 6.4% and plunged through additional support at the $58.00 level. We could not find any news that might account for AXYS' relative weakness. You might say this is the danger of trading a thinly traded stock. When the selling picked up the stock overreacted. The trade went from +$2.30 to -$1.76 except that our stop loss was at $57.95. The trend is still bullish so we'd keep AXYS on our watch list. Our target had been $64.00 and AXYS hit $63.88 on June 9th.
Picked on June 01 at $59.16 /stopped out 57.95
Mercury General - MCY - close: 49.39 change: -2.23 stop: 49.99
Wow! Murphy's law is out to get us today. First AXYS, which had been a winning play for us suddenly crashed on us. Now MCY, which was showing strength just as suddenly collapsed. The stock actually gapped open lower at $51.93 and then just fell off a cliff. Yet we couldn't find any news that my account for the sudden weakness. MCY broke support at its trendline of higher lows and broke support at the $50.00 level. Our stop loss was at $49.99.
Picked on May 28 at $50.92 *stopped out/gap higher entry
Closed Short Plays
Dover Corp. - DOV - close: 49.83 change: -2.20 stop: 54.51
Our direction on DOV was correct but our timing was a little off. We thought shares might bounce a bit more before declining. The stock hit $52.60 intraday yesterday. Our suggested entry point was $52.75. The stock lost 4.2% today and is testing support near $50 and its 50-dma. We are dropping DOV as a short because we're not going to chase it. However, we would keep DOV on your watch list. Another failed rally in the $52-53 zone might be another bearish entry point.
Picked on June xx at $xx.xx *never opened