Amgen Inc. - AMGN - cls: 56.78 change: -0.89 stop: 55.90
AMGN continued to sink on Tuesday following Monday's bearish reversal. Today's move would be considered confirmation of the reversal pattern and yet another reason for readers to consider an early exit now. The only reason we're not dropping AMGN as a bullish candidate is because we suspect that shares will find support near $56.00. We are not suggesting new bullish positions at this time. Should AMGN reverse higher our target is the $64.00-65.00 range, which might be a little too aggressive given our time frame. AMGN is due to report earnings around October 25th and we don't want to hold over the report. It's also worth noting that AMGN's P&F chart is still bearish and it will take a breakout over $60.00 to change it back into a bullish pattern.
Picked on October 11 at $ 58.01
Cummins Inc. - CMI - cls: 136.89 change: -3.27 stop: 134.45
A second day of market weakness finally overcame shares of CMI and the stock slipped 2.3%. On the positive side we saw that traders defended the stock and bought the dip multiple times near $136. A bounce from here could be used as a new bullish entry point or a new relative high. However, before you consider new positions consider your time frame. We do not want to hold over the October 25th earnings report. Our target is the $149.50-150.00 range.
Picked on October 11 at $140.85
Diamond Offshore - DO - cls: 117.84 chg: -0.38 stop: 112.45
Oil stocks rose again thanks to another new record high in crude oil. Yet oil service stocks did not participate in the rally. Shares of DO slipped to $116.35 intraday. The good news is that traders bought the dip near its lows twice and we would expect DO to rebound higher from here. Time is an issue. DO is due to report earnings on October 25th. If shares don't hit our target we'll plan to exit on October 24th at the closing bell. Our short-term target is the $124.50-125.00 range. One of our biggest concerns is that a correction in crude oil would spark some heavy profit taking in the oil service stocks. FYI: The P&F chart is bullish with a $173 target.
Picked on October 14 at $117.20
Stryker - SYK - cls: 72.27 change: -0.53 stop: 70.65 *new*
Tomorrow is our last day. We are planning to end this play at tomorrow's closing bell to avoid holding over earnings due out tomorrow night. Please note we're adjusting our stop loss to $70.65. Our target is the $74.90-75.00 range.
Picked on October 02 at $ 70.65
(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.)
Dow Jones Industrial Avg. - DJX - cls: 139.13 chg: -0.72 stop: n/a
Just two trading days left for this strangle play on the DJX. Readers may want to abandon ship right now. The DJX is a European style option and trading will cease after Thursday even though the option doesn't expire until Saturday. We are not suggesting new positions on the October version of our strangle. The options listed for our October strangle were the October $137 calls (DJY-JG) and the October $132 puts (DJW-VB) with an estimated cost of $4.75. We want to sell if either option hits $6.00.
Picked on September 16 at $134.43
Intl. Bus. Mach. - IBM - cls: 119.60 chg: +1.57 stop: n/a
IBM traded up ahead of its earnings report. Yet after the report hit the wires IBM gave back all of its Tuesday gains in after hours trading. Unfortunately, that's all the stock did. Shares were trading near $118 in after hours. We need to see a much bigger move especially for the October strangle. The company's earnings results were inline with expectations. We are not suggesting new positions at this time. Our aggressive October strangle suggested the October $125 call (IBM-JE) and the October $110 put (IBM-VB). These expire at the end of this week. Our estimated cost was $1.20. We wanted to sell if either option hit $2.40. Our November strangle suggested the November $125 call (IBM-KE) and the November $110 put (IBM-WB). Our estimated cost was $3.00. We wanted to sell if either option hits $6.00.
Picked on October 15 at $118.03
NASDAQ 100 trust - QQQQ - cls: 52.87 chg: -0.25 stop: n/a
There were some significant tech-sector earnings reports after the closing bell tonight. These should help set the tone for the NASDAQ and NDX tomorrow and probably the week. Prior to the closing bell today the rally in the NDX (and the QQQQs) looked like it was in trouble and poised to crash lower. We are not suggesting new positions. This is an aggressive play with October options that expire in three days. The options we suggested in our October strangle were the October $54 calls (QQQ-JB) and the October $53 puts (QQQ-VA). Our estimated cost was $0.76. We want to exit this strangle if either side hits $1.50 or higher.
Picked on October 14 at $ 53.53
Deutsche Bank - DB - cls: 127.93 chg: -2.00 stop: 128.99
Ouch! The financials continued to sink and shares of DB actually gapped open lower at $127.98. Our suggested stop loss was $128.99. We would have been stopped out at the open. The stock has essentially been in a slow free fall the last several days slipping past support near $132 and $130. Today's move was also a bearish breakdown under what should have been technical support at the 50-dma.
Picked on October 01 at $130.79
Terex - TEX - cls: 85.16 change: -1.40 stop: 84.75
Intraday weakness in the last hour of trading pulled TEX under short-term support near $85.00. TEX hit our stop loss at $84.75 as it traded to the intraday low of $84.41. Technicals on this stock have turned bearish over the last day or two.
Picked on September 25 at $ 86.50
Vulcan Materials - VMC - cls: 90.08 chg: -2.49 stop: 89.90
The bounce in VMC has failed. We did not see anything specific in the news to account for VMC's gap down and spike lower this morning. Shares fell toward support near $90.00 but didn't breakdown under $90.00 until late this afternoon. The stock hit our stop loss at $89.90 in the last hour of trading. Volume on today's weakness was well above the average, which is a bearish signal.
Picked on October 14 at $ 92.32