Long Play Updates
Buckle Inc. - BKE - close: 50.42 change: -1.05 stop: 48.90 *new*
Uh-oh! The trading in BKE on Friday looks pretty ugly. The stock dipped to $48.94 and bounced but the bounce looks like it was beginning to roll over into the weekend. The stock significantly under performed its peers in the retail sector with a 2% drop on Friday. More conservative traders may want to consider an early exit right here to cut your losses. We are raising our stop loss closer to Friday's low. Our new stop is $48.90. We would want to see a new move over $51.50 before considering new bullish positions but even if BKE does trade higher we suggest caution. Our target is the $57.50-60.00 zone. FYI: The Point & Figure chart is bullish with a $66 target. BKE has a high amount of short interest about 21% of the 15.5 million-share float. If BKE can hit a new relative high it could see a short covering rally.
Picked on July 22 at $51.69
iShares China 25 index - FXI - cls: 45.38 chg: +0.74 stop: 44.99
The summer 2008 Olympics begin in five trading days and we expect to hear a lot more about China all week long as the world turns its focus toward the country. The FXI managed a 1.6% bounce on Friday but this Chinese market ETF remains under a trendline of resistance. The technical picture is mixed and we're waiting for a breakout. Our suggested trigger to buy the FXI is at $47.65, which is above the 100-dma. If triggered our target is the 52.00 level or the 200-dma (currently $52.02) or whichever the FXI hits first. Keep in mind that if the FXI drops under $44.00 it would suggest a continuation of the down trend and more aggressive traders might want to consider bearish strategies.
Picked on July xx at $xx.xx <-- see TRIGGER
Masimo Corp. - MASI - close: 37.80 change: +0.03 stop: 36.75 *new*
Time is almost up for our bullish play on MASI. The stock was barely positive on Friday. MASI actually gapped lower and spiked to $36.55 before bouncing back into the green. We didn't see any specific news to account for the weakness on Friday morning. The bounce back is encouraging. The trend is still bullish. If you feel compelled to buy stocks then MASI is a good candidate but we would not open new positions ahead of the earnings report. Plus the action in the major market indices is worrisome. MASI is due to report earnings on Monday, August 4th after the closing bell. Our plan is to exit on Monday afternoon at the closing bell. We're raising our stop loss again, this time to $36.75. Our target is $41.25.
Picked on July 27 at $37.57
Terra Industries - TRA - cls: 53.91 chg: -0.09 stop: 49.95
I want to reiterate our warning from Thursday. The sharp pull back from TRA's intraday highs is not a bullish formation. TRA has already hit our first target at $56.00. We strongly suggest readers take some money off the table if you have not done so already. The agribusiness and fertilizer stocks have not been acting very strong. TRA could easily dip back to $51-50. The trend remains positive and the Point & Figure chart is still bullish but we are not suggesting new positions. Our secondary, more aggressive target is $59.85.
Picked on July 28 at $51.30
United States Nat.Gas - UNG - cls: 43.81 chg: +1.21 stop: 40.99
The outlook for UNG has improved significantly with a strong performance on Friday. Thursday's session left us wondering if Wednesday's bullish reversal was a trap. Natural gas rallied on Friday and is nearing overhead technical resistance at its 10-dma. We would still consider new bullish positions here. More conservative traders may want to use a tighter stop loss. Our target is the $48.40-50.00 zone.
Picked on July 30 at $43.39
Short Play Updates
Nordstrom - JWN - close: 28.92 chg: +0.18 stop: 30.51 *new*
Charts of the RLX retail index and JWN look very similar and both are stuck under a bearish trendline of lower highs. The last couple of weeks have seen a neutral pattern of higher lows and lower highs and I would expect the prevailing trend, which is down, to reassert itself. We're suggesting shorts now. More cautious traders may want to wait for a drop under $28.00 to initiate positions. Don't forget that we do have some risk of a short squeeze. The latest data put short interest at 17% of JWN's 160-million share float. That's close to five days worth of short interest. Our short-term target is the $25.05 mark. More aggressive traders may want to aim lower. We do not want to hold over the mid August earnings report. FYI: We're adjusting our stop loss to $30.51.
Picked on July 27 at $28.94
Closed Long Plays
Market Vectors Coal - KOL - cls: 47.61 chg: -1.61 stop: 47.95
It looks like last week's breakout in the coal stocks was a bull trap. The KOL coal ETF soared through resistance near $50 on Wednesday. We thought it looked a little overbought but the short-term trend was up. Our plan was to buy a dip near $50-49, which happened on Thursday. Unfortunately, the dip continued into Friday and KOL traded under its 100-dma and the $48.00 level. The equity hit our stop loss at $47.95 closing the play.
Picked on July 31 at $50.10 /stopped out 47.95
Closed Short Plays