Option Investor
Play Updates

It may not happen tomorrow but...

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Play Editor's Note: The market delivered some surprising strength on election day. It is conceivable that stocks might see an post-election pop. If you're a nimble enough trader I'd consider shorting such a pop. My plan is to buy a dip. It may not be tomorrow but it should occur in the next few days.

FYI: I would keep an eye on X, XTO and YHOO as potential buy the dip plays.


BULLISH Play Updates

American Express - AXP - close: 29.82 change: +1.50 stop: 24.75

The market is up about six days in a row and we don't want to chase it here. We will wait for our entry point. However, we are going to adjust our entry point to buy AXP from $25.75-25.00 to $26.50-25.50. We'll leave our stop loss at $24.75 for now. Truly nimble traders could use a post-election rally as an entry point for short-term bearish positions to catch the drop toward $26.50. We are adjusting out target, if triggered at $26.50, to 31.75.

Picked on November xx at $xx.xx <-- see TRIGGER
Change since picked:     + 0.00  			
Earnings Date          10/20/08 (confirmed) 	
Average Daily Volume:      19.4 million   


BB&T Corp. - BBT - close: 36.15 change: +0.65 stop: 31.75

BBT temporarily traded to new three weeks highs as banking stocks posted some strong gains. Unfortunately, BBT actually under performed its peers. The short-term trend remains bullish but we want to stick to our buy the dip plan. We're suggesting readers buy a dip in the $34.00-33.75 zone with a stop loss at $31.75. If triggered our target is $39.90. FYI: Readers should note that BBT has been rumored to be a merger candidate in recent weeks.

Picked on November xx at $xx.xx <-- see TRIGGER 	
Change since picked:     + 0.00 	  
Earnings Date          10/16/08 (confirmed) 
Average Daily Volume:      10.5 million  	


BHP Billiton - BHP - close: 39.28 change: +0.40 stop: 36.45 *new*

Wow! After an 8.8% move in BHP it certainly looks like the stock is running away from us. The breakout over resistance at $40.00 is definitely a bullish move. Yet volume continues to be very light, which does not confirm the rally higher. We are not going to chase shares of BHP higher but we will adjust our entry point. Instead of waiting for a dip to $36.25 we are suggesting readers buy BHP on a dip into the $37.75-37.00 zone. We'll use a stop loss at $36.45 for now. Our first target will become $44.00. The P&F chart's bullish target has risen from $63 to $72.

Picked on November xx at $xx.xx <-- see TRIGGER	 
Change since picked:     + 0.00	  
Earnings Date          10/30/08 (unconfirmed)
Average Daily Volume:       6.7 million  


Broadcom - BRCM - close: 17.69 change: +0.61 stop: 16.45 *new*

BRCM kept pace with the market's election-day rally but the stock remains under short-term resistance at $18.00. We are upping our stop loss to $16.45. Currently our target is $18.45 near the simple 50-dma.

Picked on October 24 at $16.10 *triggered 10/24 
Change since picked:    + 1.59 	  
Earnings Date         10/21/08 (confirmed) 
Average Daily Volume:       14 million 


CIENA Corp. - CIEN - close: 9.17 change: +0.33 stop: 8.49 *new*

It was a volatile session for CIEN. The stock gapped higher at $9.07 and shot to $9.79 near yesterday's high before sharply paring its gains back to $9.17. Overall this looks like a short-term failed rally pattern, which is bearish. We are choosing to reduce our risk by raising the stop loss to $8.49. We have two targets. The first target is $11.75. Our secondary target is $13.85. This play might take a few weeks to reach its conclusion. FYI: The P&F chart is bullish with a $15.00 target.

Picked on November 03 at $ 9.00 *triggered 11/03	
Change since picked:     + 0.17	  
Earnings Date          12/11/08 (unconfirmed) 	 
Average Daily Volume:       5.9 million 


Ingersoll-Rand - IR - close: 18.72 change: +0.90 stop: 16.99

IR dipped to $17.57 before rebounding to a 5% gain and closing back above the $18.00 level. This looks like another entry point to get long IR. More conservative traders might want to up their stop loss toward $17.50. Our target is the $22.00 mark. More aggressive traders may want to aim higher, say the $25-26 zone.

Picked on October 31 at $18.65 	 
Change since picked:    + 0.07  	 
Earnings Date         10/24/08 (confirmed)
Average Daily Volume:      4.8 million     


Lam-Research - LRCX - close: 24.77 change: +1.86 stop: 19.95 *new*

Here is another stock where it looks like we may have missed the move. Shares are up from $20 to $25 in just a few days. LRCX was up more than 8% today following an analyst upgrade and a $25 price target. We are not going to chase it. Our plan is to buy a dip. However, we're going to alter that entry point from $21.00-20.00to $22.00-21.00. We'll adjust the stop loss to $19.95 while more conservative traders may want to use a stop loss closer to $21.00. We're adjusting the target to $25.85. FYI: Nimble traders could use a move toward $26.00, more specifically a failed rally near $26, as an entry point for a short-term bearish play to catch a drop back to $22.50-22.00.

Picked on November xx at $xx.xx <-- see TRIGGER	
Change since picked:     + 0.00	  
Earnings Date          10/22/08 (confirmed)
Average Daily Volume:       4.0 million   


Nucor - NUE - close: 39.66 change: +1.83 stop: 33.75

Iron and steel stock NUE is still consolidating under resistance near $40-41 and its 50-dma. We don't see any changes from our previous comments. We are suggesting readers buy NUE on a pull back into the $36.50-34.50 zone. If triggered our first target is $41.00. Our second target is $44.75.

Picked on November xx at $xx.xx <-- see TRIGGER	
Change since picked:     + 0.00	  
Earnings Date          01/22/09 (unconfirmed) 
Average Daily Volume:       9.7 million   


Ultra(Long) Real Estate - URE - cls: 11.49 change: +1.04 stop: 9.75*new*

The URE produced another big move today. This double-long real estate ETF soared 9.9% and set a new two-week high. We are going to adjust our trigger point to buy the URE from $10.00-9.75 to $10.50-10.00. Our new stop loss will be $9.75. If we are triggered our first target is $12.45. Our second target is $14.75.

FYI: The URE is an exchange-traded fund (ETF) that typically moves twice the daily performance of the Dow Jones Real Estate index.

Picked on November xx at $xx.xx <-- see TRIGGER
Change since picked:     + 0.00	  
Earnings Date          00/00/00 	  
Average Daily Volume:       1.6 million  


Wal-Mart - WMT - close: 56.13 change: +0.16 stop: 53.90 *new*

The action in WMT continues to raise concern. The stock significantly under performed the market today. Shares produced another failed rally under its 50-dma and the $57.50 level. We are not suggesting new bullish positions at this time and we're raising our stop loss to $53.90. We remain worried that the 50-dma and 100-dma around $57.40-57.50 will be unbeatable resistance in the short-term. If we don't see some improvement very soon we're going to drop this play. Should the stock manage a breakout our target is $59.95. We don't want to hold over the mid November earnings report.

Picked on October 29 at $56.25 *triggered 
Change since picked:    - 0.14	 
Earnings Date         11/13/08 (unconfirmed) 
Average Daily Volume:       25 million   


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