Broadcom - BRCM - cls: 35.87 change: +0.50 stop: 33.95
Last night's legal victory for QCOM, even though it is temporary, lifted shares of QCOM over 3%. Oddly enough this seemingly bearish news did not deter BRCM from gaining ground. The stock may have gotten a boost from a new "buy" rating on it announced this morning. Bulls seem to be having a hard time holding on to gains in BRCM but the trend still looks positive. We would still consider new positions above $36.00. More conservative traders may want to wait for a rise past $37.00. Our target is the $39.85-40.00 range. The Point & Figure chart is bullish with a $49 target.
Picked on September 12 at $ 35.85
Intl. Bus. Mach.- IBM - cls: 115.95 chg: -0.05 stop: 113.24
We believe that traders should turn defensive on IBM. The stock has been under performing the market this past week. Shares failed to join the DJIA rally or any strength in tech stocks. This relative weakness would suggest a deeper consolidation ahead. We're not suggesting new positions at this time. The stock has already hit our $118-120 target range. Our second, more-aggressive target is the $124.00-125.00 zone. FYI: The Point & Figure is very bullish with a $177 target.
Picked on August 26 at $113.24
Manitowoc - MTW - cls: 39.14 change: +0.02 stop: 37.48
MTW under performed the markets today. Shares tried to rally midday but it rolled over under the $40.00 mark, which is bearish! While today doesn't really confirm Wednesday's bearish reversal pattern it didn't do much for the bulls either. We're not suggesting new positions at this time. More conservative traders may want to consider an early exit right here or raise their stop loss toward $38.00. Our post-split target is the $44.00-45.00 range. Our post-split stop loss is $37.48.
Picked on September 05 at $ 40.13 *split adjusted
Triumph Group - TGI - cls: 76.46 change: +1.25 stop: 72.45
TGI is off to a good start. The stock continued to rally and pushed through resistance near $75.75 and last week's high. The MACD indicator on the daily chart has produced a new buy signal. The play is open now that shares hit our suggested trigger at $75.85. Please note that the rally did begin to fade into the closing bell. Readers might get another chance to buy a dip near $76.00-75.50 tomorrow. We have two targets. Our first target is the $79.75-80.00 range. Our second, more aggressive target is the $82.50-84.00 range. Please note that in the wrap Tuesday night Jim pointed out that there is a seasonal pattern of weakness in the second half of September. Readers may want to keep that in mind and just pass on any new bullish candidates. FYI: The latest data puts short interest at more than 13% of the 16-million share float. That's a high degree of short interest and raises the risk of a short squeeze, which would be great news for our long play!
Picked on September 13 at $ 75.85
Transocean - RIG - cls: 107.58 change: +0.89 stop: 104.85
Crude oil hits new record highs over $80 a barrel today yet RIG can't breakout from its sideways trading range. Readers can watch for another bounce near $105 as a potential entry point for bullish positions but RIG is facing short-term resistance in the $109-110 range. Our target is the $114.00-115.00 range.
Picked on August 31 at $105.75
Acuity Brands - AYI - cls: 48.86 change: -0.92 stop: 52.80*new*
Shares of AYI continue to under perform the market. AYI lost 1.8% after producing another bearish failed rally under the $50.00 level. We are adjusting our stop loss to $52.80. We're not suggesting new positions at this time. We have two targets. Our first target is the $47.75-47.50 range. Our second target is the $45.25-45.00 zone. FYI: In the news today AYI announced it was spinning off its Acuity Specialty Products Group under a new name of Zep Inc. The new spin off is expected to be listed on the NYSE under the stock symbol "ZEP". The spin-off is expected to be completed later this fall. We are not sure how this spin-off will affect shares of AYI.
Picked on August 26 at $ 52.80
L-3 Comm. - LLL - cls: 98.27 change: +0.53 stop: 98.55
Traders continue to buy the dips in LLL but shares aren't making much progress with the rallies. We don't see any changes from our previous comments on LLL. The stock is still under performing the defense sector and the tech sector. Currently we're waiting for a breakdown under $96.00. Our suggested trigger to buy puts is at $95.90. If triggered at $95.90 our target is the $90.75-90.00 range but we may need to adjust that as the 200-dma continues to rise.
Picked on September xx at $ xx.xx <-- see TRIGGER
Whirlpool - WHR - cls: 91.57 change: +1.33 stop: 95.15
WHR managed a much more successful oversold bounce today. Shares rose 1.4% but this looks like a speed bump on the way down. We don't see any changes from our previous comments. We have two targets. Our first target is the 87.75-87.50 range. Our second target is the $85.00-84.00 range.
Picked on September 09 at $ 92.77
U.S.Steel - X - close: 90.29 change: +1.03 stop: 96.51
Nucor (NUE) made the headlines again. Yesterday it was an earnings warning. Today it was M&A news with an announcement that NUE was buying Nelson Steel. Some market watchers claim that this deal might re-ignite the takeover rumors and buying frenzy that pushed steel stocks higher last spring. Shares of X didn't overreact. The stock rose 1.1% and was trading off its best levels of the day. We would look for a new decline under $90.00 or yesterday's low of $88.96 as a new entry point to buy puts on X. Our target is the $81.00-80.00 range. We do have a wide stop loss because the market has been so volatile lately. The P&F chart is currently bullish but it wouldn't take much to reverse into a new sell signal.
Picked on September 12 at $ 89.26
(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.)
Bear Stearns - BSC - cls: 114.83 chg: +4.78 stop: n/a
Broker-dealer stocks were one of the best performing sectors today. BSC contributed a lot with a 4.3% gain and a breakout past the $110 level. Last night on CNBC's Fast Money show they had an analyst suggesting that BSC was a takeover target. This isn't a new opinion on BSC but it might have gotten lost in the market's recent volatility and sub-prime mess. We're not suggesting new positions at this time. Currently our strangle involves the October $115 call (BSC-JC) and the October $95 put (BVD-VS). Our estimated cost was $9.50 and we want to sell if either option hits $14.00 or more. The company is expected to report earnings on September 20th. This should be considered a more aggressive play.
Picked on September 09 at $105.37
Diamonds - DIA - cls: 134.30 chg: +1.05 stop: n/a
The DIA has rallied toward resistance at its 50-dma, 100-dma and the $135 level. Further gains could be a challenge. We are not suggesting new positions in the DIA at this time. Our strangle play suggested using the September $137 call (DAZ-IG) and the September $127 put (DAW-UW) with an estimated cost of $2.05. We want to sell if either option rises to $3.10 or more. We have less than two weeks left before September options expire.
Picked on August 30 at $132.57
S&P 100 Index - OEX - cls: 695.00 chg: +6.58 stop: n/a
The OEX has rallied back toward resistance at its early September high. Can it breakout? We're not suggesting new positions in the OEX at this time. Our strangle strategy suggested using the September 700 call (OEZ-IT) and the September 660 put (OEY-UL) with an estimated cost of $14.30. We want to sell if either option rises to $21.45 or more. Considering these prices we probably need to see a move into the $705-710 range or the $655-650 zone to be profitable.
Picked on August 30 at $680.46