Akamai Technologies - AKAM - cls: 50.45 chg: -0.56 stop: 47.95
The U.S. markets ran out of gas last week as investors turned their focus on the Thanksgiving holiday. This left shares of AKAM churning sideways between $50.00 and $51.25. Overall we don't see any changes from our original play description. AKAM's P&F chart is bullish and the daily chart has a bullish trend of higher lows and technical support at its rising 50-dma. However, we are labeling this an aggressive entry point near $50 because AKAM does have some resistance near $52.00 and $53.00 with its November and October highs. Plus, the technical indicators are mixed. Readers have a choice to buy the dip near $50 or wait for a breakout past $52.00. Our short-term target is the $57.00-60.00 range.
BUY CALL JAN 50.00 UMU-AJ open interest=3481 current ask $3.90
Picked on November 21 at $ 50.65
Bear Stearns - BSC - close: 158.60 chg: +0.18 stop: 151.89
Two cents. Shares of BSC gapped lower on Friday morning but managed to claw its way back into the green. The stock came within two cents of our target in the $159.00-160.00 range. Shares look poised to move higher on Monday but more conservative readers may want to seriously consider exiting early to lock in a gain. We're not suggesting new positions at this time.
Picked on November 14 at $151.89
CNOOC - CEO - close: 87.85 change: +1.23 stop: 84.45
Crude oil futures closed back over $60 a barrel on Friday as the market reacted to talks that OPEC might decide on new production cuts next month. The oil indices didn't move much but shares of CEO rose 1.4%. The stock's show of relative strength is encouraging but this is not the greatest entry point to consider new plays. If you're looking for a new entry wait for a dip back towards $85.50-86.00ish. Our target is the $89.50-90.00 range.
Picked on November 21 at $ 85.94
FedEx - FDX - close: 117.36 chg: -1.27 stop: 113.90
FDX's bullish breakout higher on Wednesday deflated on Friday. The stock lost just over 1% and looks poised to dip toward the $116 region. Overall the trend in FDX looks bullish but the stock's lack of upward momentum over the last week and a half has begun to turn the technical indicators bearish. We would be cautious here especially with an up tick in crude oil, which tends to put pressure on the transports. A bounce from $117 would be encouraging and traders could use it as a new entry point but as we said earlier we're expecting a dip. We also expect the $120 level to act as resistance on the stock's initial test. Our target is the $124.00-125.00 range. The P&F chart is more optimistic with a $153 target. FYI: We do not want to hold over the December earnings report.
Picked on November 15 at $117.15
Fomento Econo. - FMX - close: 104.82 chg: -0.78 stop: 99.49
FMX hit an intraday high of $106.75 on Friday. That was not quite enough to hit our target in the $107-110 range. Shares of FMX were somewhat volatile with a wide range on Friday morning. Overall the trend is still bullish but it might be time for a rest. Currently FMX has short-term technical support at its 10-dma (near $103.90) and additional support in the $102.00-102.50 region. More conservative traders may want to tighten their stops. We're not suggesting new positions at this time although a bounce from the 10-dma would qualify as a new entry point.
Picked on November 08 at $102.09
KLA-Tencor - KLAC - close: 51.72 chg: -0.71 stop: 49.49*new*
KLAC and the SOX semiconductor sector have seen the upward momentum wane. The short-term technical indicators for KLAC are beginning to look tired and shares may be ready to dip to its 10-dma near $51 or more likely a dip back towards the $50.00-50.50 region. A bounce from the $50 region could be used as a new entry point to go long calls on the stock but keep an eye on the NASDAQ and the SOX to see if they confirm any bounce. We're raising our stop loss to $49.49. Our target is the $54.50-55.00 range. The stock appears to have solid resistance at $55.00.
Picked on November 14 at $ 50.81
Sepracor - SEPR - close: 55.30 chg: +0.00 stop: 52.35 *new*
Shares of SEPR closed unchanged on Friday. The stock has been stuck in a relatively narrow range for the last four sessions. We are bullish given the breakout over $54.00, which produced a new significant breakout on the Point & Figure chart. However, lack of momentum is a concern. Meanwhile the DRG drug index is trending lower and the BTK biotech index looks significantly overbought and due for a consolidation. Given the condition of the biotech and drug sectors traders will want to be cautious about how much money they put at risk in SEPR. We're going to raise our stop loss to $52.35. Currently the P&F chart has a triple-top breakout buy signal with a $68 target. We're aiming for the $59.50-60.00 range because the daily/weekly charts have resistance near $60.00.
CALL JAN 52.50 ERU-AX open interest= 3140 current ask $5.70
Picked on November 19 at $ 54.69
Thomas & Betts - TNB - close: 52.82 chg: -0.01 stop: 49.90
The last couple of days have been a non-event for TNB. Shares have consolidated sideways hugging its 10-dma. However, over the last week the technical picture has taken a turn for the worse, at least in the short-term indicators. We're not suggesting new positions at this time and more conservative traders may want to tighten their stops. Keep in mind that TNB is likely to have support near $50 with its 200-dma and 50-dma. Our target is the $56.00-57.00 range. Currently the P&F chart points to a $77 target.
Picked on November 12 at $ 51.36
(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.)
Caterpillar - CAT - close: 62.87 chg: +0.08 stop: n/a
Traders need to make a decision with this strangle play on CAT. We only have three weeks left before December options expire. For this play to have any hope of being successful we need to see CAT trade above $66 or under $54 before expiration. That is certainly possible but if the last few weeks are any indication then odds are growing that our options will expire worthless. If you're not willing to risk it then try exiting early and salvaging some of your trading capital. We're not suggesting new positions. The options in our strangle are the December $65 call (CAT-LM) and the December $55 put (CAT-XK). Our estimated cost was about $0.75. We want to exit if either options rises to $1.50.
on November 08 at $ 60.10
Blue Nile - NILE - cls: 36.24 chg: -0.03 stop: n/a
Shares of NILE have spent the last couple of weeks consolidating sideways. That consolidation has narrowed and usually when the range gets this tight we can expect a breakout (one way or the other) pretty soon. We're not suggesting new strangle positions at this time. Our estimated cost was $2.40 and we're planning to sell if either side of our strangle rises to $3.90. The options in our suggested strangle are the January $45 call (JWU-AI) and the January $35 put (JWU-MG).
Picked on October
29 at $ 38.92
Cardinal Health - CAH - cls: 62.21 chg: +0.05 stop: 64.05
It's been about two weeks since the CAH play opened when shares hit our trigger at $61.99. Unfortunately, the stock has not made any progress in spite of the overall trend being bearish. We're suggesting an early exit due to lack of follow through. More patient traders may want to keep the play alive and just keep a tight reign on your stops.
Picked on November 10 at $ 61.99