Baker Hughes - BHI - cls: 85.55 change: +2.38 stop: 79.95
Our new call play in BHI is now open. The stock broke out over resistance at the $84.00 level early today. Boosting the sector were positive analyst comments out of Morgan Stanley. Another strong rally in crude oil today certainly didn't hurt the bulls. We suggested that readers use a trigger at $84.26 to buy calls. Now that the play is open our target is the $89.00-90.00 range. The P&F chart has reversed from a sell signal to a new buy signal with a $94 target. Also in the news it was announced that BHI had reached a settlement with the U.S. relating to a bribery probe into the company's divisions in Angola, Kazakhstan, and Nigeria.
Picked on June 04 at $ 84.26
Chaparral Steel - CHAP - cls: 73.74 chg: -0.45 stop: 69.95
Steel and metals stocks lagged the market on Monday. Investors might have been disappointed that there weren't any mergers announced but honestly we can't say why the group under performed today. Volume came in very low for CHAP so it's hard to reach much into today's performance. Overall the trend is unchanged and CHAP still has a bullish trend of higher lows. The afternoon bounce might be considered a new entry point. More conservative traders will want to strongly consider waiting for a breakout over $75.00 or the $75.50-75.60 zone before buying calls. We're going to set two targets. Our first target is the $79.50-80.00 range. Our aggressive target is the $84.00-85.00 range. The P&F chart currently points to a $99 target.
Picked on May 30 at $ 73.69
Carpenter Tech - CRS - cls: 135.15 chg: -0.52 stop: 129.90
CRS is another metals stock that under performed the market on Monday. We're not too alarmed. A little bit of profit taking after Friday's rally is not a surprise. Given today's trading we would suggest patience and watch for a dip into the $132.00-133.00 zone as a potential entry point. An alternative entry point would be to wait for a new relative high over $138. The P&F chart shows a triple-top breakout buy signal that points to a $170 target. Our target is the $147.50-150.00 range although we would expect some resistance near its all-time high around $142. FYI: We are surprised that CRS did not show more strength today following last Friday's news about the stock being added to the S&P midcap 400 index.
Picked on June 03 at $135.67
F5 Networks - FFIV - close: 81.89 chg: +0.35 stop: 74.95
The networking sector continued to rally and turned in one of today's best performances. FFIV under performed its peers but managed a 0.4% gain. Volume came in very low for FFIV today, which might be a cautionary sign. We would still consider new positions here but strongly suspect that shares will dip toward the $80.00 level soon. Buying a dip or bounce near $80 would be an attractive entry point. More conservative traders might want to use a tighter stop loss in the $78.00 or $77.50 zone. Our target is the $89.00-90.00 range.
Picked on June 03 at $ 81.54
Global SantaFe - GSF - cls: 70.25 chg: +1.39 stop: 65.90
A strong session for oil prices and some positive analyst comments for oil service stocks helped GSF rally to a new closing higher. The stock closed up over 2% and the close over round-number resistance at $70.00 is a positive sign. If the stock sees any profit taking look for the $68 level to act as short-term support. Our target is the $74.50-75.00 range. The P&F chart displays a triple-top breakout buy signal with an $87 target.
Picked on June 03 at $ 68.86
Altria Group - MO - cls: 71.80 change: -0.02 stop: 69.90
We don't see any changes from our weekend comments on MO. The stock has regained its bullish pattern of higher lows and we suspect shares are about to hit new highs again. We are aiming for the $76.00-77.00 range, which would coincide with the $77.00 target on the P&F chart. More conservative traders may want to wait for a new high first before opening positions.
Picked on June 03 at $ 71.82
OM Group - OMG - cls: 62.56 chg: -0.17 stop: 59.85
We are starting to worry about OMG. Shares have been stuck under the $64 level for days now and the upward momentum is dying. More than one of its technical indicators are starting to turn bearish. The sideways consolidation is still narrowing so we're not ready to abandon the play yet and broken resistance at $60.00 is the clearest level of potential support. We are suggesting that readers wait for a breakout over $64.00 before considering new positions. Our target is the $68.50-70.00 range. The P&F chart is bullish with an $86 target.
Picked on May 27 at $ 62.44
Sunoco - SUN - cls: 84.17 chg: +3.06 stop: 79.45 *new*
Target achieved. A hefty 1.7% rally in crude oil fueled a big move in the oil stocks. Shares of SUN surged 3.77% on strong volume to hit new one-year highs. Our first target was the $84.00-85.00 range. We now expect the $85 level to act as short-term resistance so be ready for some profit taking. We are going to raise the stop loss to $79.45. Our second, more aggressive, target is the $88.00-90.00 range. The updated P&F chart has seen its buy signal rise from $94 to $109 over the last several days.
Picked on June 01 at $ 80.26
Tesoro - TSO - close: 63.95 change: +0.21 stop: 57.99
Hmmm... we are surprised that TSO under performed the oil sector today. Shares have been a real leader in the group but they struggled to participate during Monday's energy rally. Volume continued to slide. We suspect TSO will see a dip toward $62.00 soon, which would be an attractive entry point. Our target is the $69.00-70.00 range.
Picked on June 03 at $ 63.74
Vangard Emergy Mkts ETF -VWO- cls: 89.02 chg: -0.27 stop: 84.99
We don't see any changes from our weekend comments for the VWO. The ETF failed to make any headway but neither did it see any serious profit taking. More conservative traders may want to tighten their stops. The ETF is nearing our target in the $89.85-90.00 range. More aggressive traders may want to aim higher.
Picked on May 16 at $ 86.15
XTO Energy - XTO - cls: 61.61 chg: +3.24 stop: 56.74 *new*
Monday proved to be a big day for XTO. The stock gapped open higher at $60.51 and traded to an intraday high of $62.25 before paring its gains and close up 5.5%. The move was powered by news that XTO was buying some natural gas and oil properties from Dominion Resources for $2.5 billion. Unfortunately, the company decided to take advantage of this positive development and announced a 15 million-share secondary offering at the closing bell tonight. Investors tend to get unhappy when a company dilutes their position but 15 million shares might not be too much compared to XTO's 368 million shares outstanding. We wouldn't be surprised to see any profit taking tomorrow. More conservative traders may want to do some profit taking of their own. Please note that we're adjusting the stop loss to $56.74. Our target is the $62.50-65.00 range. Aggressive traders may want to aim higher.
Picked on May 27 at $ 57.63
Anixter Intl. - AXE - cls: 72.61 chg: -0.22 stop: 72.05
We don't see any changes from our weekend comments for AXE. We are currently sitting on the sidelines so it doesn't hurt to leave AXE on the newsletter as a bearish candidate but the bears are definitely having a hard time here and AXE looks closer to breaking out over resistance near $75.00 than breaking down under $70.00. Currently it is our suggested strategy to buy puts on a breakdown under $68.50. We are considering a higher trigger point at $69.00 or just under $70.00 but for now we'll stick with a $68.49. More nimble traders might actually want to scope out potential bullish positions if AXE can trade over resistance at the $75.00 mark.
Picked on May xx at $ xx.xx <-- see TRIGGER
Gilead Sciences - GILD - cls: 83.78 chg: +0.78 stop: 82.55
GILD is starting to look more and more bullish. Shares rose 0.9% and the technical indicators are improving. The stock is nearing resistance at the top of it trading range near $84.50. Nimble traders might want to consider buying calls on a breakout over $84.50 or over $85.00. We might switch directions on a move over $85.00. Currently we've been waiting for a breakdown under $80 and the bottom of its trading range. Our suggested trigger is at $79.90. Readers should note that the stock is set to split 2-for-1 on June 25th. FYI: The P&F chart is still bullish with a $97 target but a drop under $80 should reverse it into a new sell signal.
Picked on May xx at $ xx.xx <-- see TRIGGER
Vital Images - VTAL - cls: 27.55 chg: -0.70 stop: 29.05
VTAL continues to under perform. The stock produced a bearish failed rally under last week's highs near $28.35. This could be considered a new entry point for puts. Our target is the $25.15-25.00 range.
Picked on May 16 at $ 27.99