In addition to tonight's new candidate(s), consider these stocks as possible trading ideas and watch list candidates. Some of these stocks may need to see a break past key support or resistance:
MDSO, D, PPG, PXD, RKT, KSU, MLM, TRW, ACT, VRX, WAT, GPOR, SBUX, FEIC, TRIP
NEW DIRECTIONAL CALL PLAYS
Toyota Motor Co. - TM - close: 121.30 change: +2.17
Stop Loss: 118.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below
Why We Like It:
The Japanese NIKKEI index plunged another -6.3% today and officially hit a new bear market, closing at ten-week lows. Part of the sell-off in Japanese markets is the big bounce in the yen. The Japanese currency was very oversold so a bounce is not that surprising. What is surprising is how shares of TM have somehow disconnected themselves from the carnage happening back home in Japan. Normally a rising yen would be bearish for a large exporter like TM since it makes their products more expensive.
About a week ago TM bounced near its long-term up trend of higher lows. Today was a good example of TM showing relative strength and ignoring the sell-off in Japan.
There is a risk that this is just a temporary bounce in TM and the new down trend in the NIKKEI and the rally in the yen will reassert their influence on shares of TM. Currently we're not seeing it in TM's stock.
Tonight we are suggesting a trigger to buy calls if TM can trade at $122.10 or higher. The stock does tend to gap open higher so we could see TM gap open above this level. If triggered our initial target is $130.00 while more aggressive traders may want to aim higher.
Trigger @ 122.10
- Suggested Positions -
Buy the Jul $125 call (TM1320G125) current ask $3.20
Entry on June -- at $---.--
Average Daily Volume = 821 thousand
Listed on June 13, 2013